Consider the Following Conditions for an Item Used in the Hess

question 5

Multiple Choice

Consider the following conditions for an item used in the Hess Company's manufacturing process:
Which of the following statements best describes Hess's situation regarding inventory replenishment?

• A) No action is required, since a scheduled receipt is due to be delivered to Hess.
• B) To cover its backorders, Hess should order two lots of 50 units.
• C) Because it is incurring backorders, Hess should increase its reorder point.
• D) Hess should place an order for 50 units, since the inventory position is less than the reorder point.