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The Watata Company uses 150,000 gallons of acid per month. The cost of carrying the chemical in inventory is P30 per gallon per year, and

The Watata Company uses 150,000 gallons of acid per month. The cost of carrying the chemical in inventory is P30 per gallon per year, and the cost of ordering the chemical is P7,500 per order. The firm uses the chemical at a constant rate throughout the year. It takes 21 days to receive an order once it is placed. The reorder point is

A. 105,000 gallons.

B. 7,500 gallons.

C. 90,000 gallons.

D. 30,000 gallons.

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