Final answer:
The re-order point (ROP) can be calculated by adding the daily demand during the lead time to the on-hand inventory.
Step-by-step explanation:
The re-order point (ROP) is the inventory level at which a new order should be placed to replenish stock. To calculate the ROP, we need to consider the average daily demand and the lead time.
Given the average daily demand is 53 units and the lead time is 4 days, we can determine the daily demand during the lead time by multiplying the average daily demand by the lead time: 53 units/day * 4 days = 212 units.
The ROP is then calculated by adding the daily demand during lead time to the on-hand inventory: 212 units + 826 units = 1038 units.