Final answer:
a. The reorder stock level for the delivery period is between 4-6 months and the reorder quantity is 6000 units is 24000 bags.
b. The maximum stock level is 22800 bags.
c. The minimum stock level is 11040 bags.
d. The average stock level for Jombo Ltd is 16920 bags.
Step-by-step explanation:
To address the student's question related to Jombo Ltd, we need to compute several inventory metrics: the reorder stock level, maximum stock level, minimum stock level, and average stock level. The data given includes a delivery period of 4-6 months and a reorder quantity of 6000 units.
a. Reorder stock level: This is computed based on the maximum usage during the lead time. Assuming the maximum monthly usage is 4000 bags (from January), and considering the longest delivery period of 6 months, the reorder level would be
4000 bags × 6 months = 24000 bags.
b. Maximum stock level: Found by adding the reorder quantity to the reorder level and then subtracting the minimum usage (during lead time). If the minimum monthly usage is 1200 bags (from March or May) for the longest lead period of 6 months, the minimum usage is 7200 bags. Hence, the maximum stock level would be
24000 bags (reorder level) + 6000 bags (reorder quantity) - 7200 bags (minimum usage) = 22800 bags
c. Minimum stock level: Equal to the reorder level minus the average monthly usage during the maximum delivery time. If we estimate an average usage of (4000+2400+1200+2000+1200)/5 = 2160 bags per month over 6 months, that would be 12960 bags. Therefore, the minimum stock level is
24000 bags - 12960 bags = 11040 bags.
d. Average stock level: Calculated by averaging the minimum and maximum stock levels. So,
(11040 bags + 22800 bags) / 2 = 16920 bags.