If No Variations in Demand or Lead Time Exist, the ROP

question 109

Multiple Choice

If no variations in demand or lead time exist, the ROP will equal

• A)the EOQ.
• B)expected usage during lead time.
• C)safety stock.
• D)the service level.
• E)the EOQ plus safety stock.

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Definitions:

Donated Treasury Stock

Shares that were once repurchased by the issuing company and are later donated to a beneficiary.

Cost Method

An accounting technique used to value inventory, usually at the lower of cost or market price, and investments in certain conditions.

Par Value Method

An accounting method used for issuing shares that assigns a nominal value (par value) to the shares, which may affect the accounting treatment of share issues.

Retiring Treasury Stock

The act of permanently removing previously bought-back shares (treasury stocks) from the market, reducing the company's available shares and total equity.