Lead Time for Computers Is 7 Days with Daily Demand

question 6

Multiple Choice

Lead time for computers is 7 days with daily demand of 5 computers and a safety stock of 1 day. Each kanban holds 5 computers. What is the correct number of kanbans?

• A) 4.5
• B) 1
• C) 5
• D) 7
• E) 8

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Definitions:

Weighted Average

It's a calculation that takes into account the varying degrees of importance of the numbers in a data set, often used in determining the cost of inventory.

Erratic Changes

Unpredictable fluctuations that do not follow a set pattern or trend, often affecting financial markets or economic conditions.

Inventory Cost Method

An accounting technique used to determine the value of a business's inventory and cost of goods sold, such as FIFO (First In, First Out) or LIFO (Last In, First Out) methods.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenues, indicating financial performance over a specific period.