Question

An Office Manager uses a Periodic Review Inventory System: they check the inventory in the Office Supply Closet once every 10 days, placing an order with their supplier depending on the inventory level in the closet. Once the order is placed, it takes 3 days to receive the order. The average demand for highlighters is 50 per day. This week, the manager has counted 180 highlighters in the closet. What is the Minimum Restocking Level (restocking policy) needed to cover expected demand over time without stocking out?

Answer 1

Answer:the Minimum Restocking Level= 650 units

Step-by-step explanation:

The Minimum Restocking Level is given as

= Average daily demand × reorder period + Average daily demand × lead time

= 50 × 10 days + 50 × 3 days

= 500 + 150

= 650 units