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When re-ordering level is 200 units, minimum usage is 20 units, minimum lead time is 5 days, maximum stock is 400 units then re-ordering quantity will be:
(A) 400 units
(B 200 units
(C)
300 units
(D) 100 units?
(A) 400 units
(B 200 units
(C)
300 units
(D) 100 units?
Most Upvoted Answer
When re-ordering level is 200 units, minimum usage is 20 units, minimu...
Understanding Re-Ordering Quantity
When determining the re-ordering quantity, it's essential to consider the re-ordering level, minimum usage, lead time, and maximum stock. Let's break down the components:
Key Parameters
- Re-ordering Level: 200 units
- Minimum Usage: 20 units per day
- Minimum Lead Time: 5 days
- Maximum Stock: 400 units
Calculating Requirements
1. Usage During Lead Time:
To find out how much stock is needed during the lead time, multiply the minimum usage by the lead time:
- Minimum Usage (20 units) x Lead Time (5 days) = 100 units.
2. Determining Stock Levels:
Since the re-ordering level is set at 200 units, this means you want to maintain at least that amount before re-ordering. After using 100 units during the lead time, the available stock must cover this usage.
3. Calculating Re-Ordering Quantity:
To ensure you can replenish stock, you need to consider how much to order. The re-ordering quantity is calculated as follows:
- Re-ordering Level (200 units) + Usage During Lead Time (100 units) = 300 units.
Conclusion
Among the options provided:
- (A) 400 units
- (B) 200 units
- (C) 300 units
- (D) 100 units
The correct re-ordering quantity is (C) 300 units. This allows for sufficient inventory to cover usage during the lead time while adhering to maximum stock constraints.
When determining the re-ordering quantity, it's essential to consider the re-ordering level, minimum usage, lead time, and maximum stock. Let's break down the components:
Key Parameters
- Re-ordering Level: 200 units
- Minimum Usage: 20 units per day
- Minimum Lead Time: 5 days
- Maximum Stock: 400 units
Calculating Requirements
1. Usage During Lead Time:
To find out how much stock is needed during the lead time, multiply the minimum usage by the lead time:
- Minimum Usage (20 units) x Lead Time (5 days) = 100 units.
2. Determining Stock Levels:
Since the re-ordering level is set at 200 units, this means you want to maintain at least that amount before re-ordering. After using 100 units during the lead time, the available stock must cover this usage.
3. Calculating Re-Ordering Quantity:
To ensure you can replenish stock, you need to consider how much to order. The re-ordering quantity is calculated as follows:
- Re-ordering Level (200 units) + Usage During Lead Time (100 units) = 300 units.
Conclusion
Among the options provided:
- (A) 400 units
- (B) 200 units
- (C) 300 units
- (D) 100 units
The correct re-ordering quantity is (C) 300 units. This allows for sufficient inventory to cover usage during the lead time while adhering to maximum stock constraints.
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When re-ordering level is 200 units, minimum usage is 20 units, minimum lead time is 5 days, maximum stock is 400 units then re-ordering quantity will be:(A) 400 units (B 200 units(C)300 units(D) 100 units?
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When re-ordering level is 200 units, minimum usage is 20 units, minimum lead time is 5 days, maximum stock is 400 units then re-ordering quantity will be:(A) 400 units (B 200 units(C)300 units(D) 100 units? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about When re-ordering level is 200 units, minimum usage is 20 units, minimum lead time is 5 days, maximum stock is 400 units then re-ordering quantity will be:(A) 400 units (B 200 units(C)300 units(D) 100 units? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for When re-ordering level is 200 units, minimum usage is 20 units, minimum lead time is 5 days, maximum stock is 400 units then re-ordering quantity will be:(A) 400 units (B 200 units(C)300 units(D) 100 units?.
When re-ordering level is 200 units, minimum usage is 20 units, minimum lead time is 5 days, maximum stock is 400 units then re-ordering quantity will be:(A) 400 units (B 200 units(C)300 units(D) 100 units? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about When re-ordering level is 200 units, minimum usage is 20 units, minimum lead time is 5 days, maximum stock is 400 units then re-ordering quantity will be:(A) 400 units (B 200 units(C)300 units(D) 100 units? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for When re-ordering level is 200 units, minimum usage is 20 units, minimum lead time is 5 days, maximum stock is 400 units then re-ordering quantity will be:(A) 400 units (B 200 units(C)300 units(D) 100 units?.
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