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Vision Company sells optical equipment. Blitz Company manufactures special glass lenses. Vision orders 11,400 lenses per year, 220 per week, at $40 per lens. Blitz
Vision Company sells optical equipment. Blitz Company manufactures special glass lenses. Vision orders 11,400 lenses per year, 220 per week, at $40 per lens. Blitz covers all shipping costs. Vision earns 22% on its cash investments. The purchase-order lead time is 3.0 weeks. Vision sells 315 lenses per week. The following data are available:
Relevant ordering costs per purchase order | $47.25 |
Relevant insurance, materials handling, breakage, and so on, per year | $5.50 |
What is the reorder point?
945 lenses
1605 lenses
660 lenses
1318 lenses
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