A Factory in Syria Has the Following Information: Reorder Level

question 8

Multiple Choice

A factory in Syria has the following information: reorder level 1,600 units; EQQ 32,000 units; minimum usage 600 units; minimum lead time 3 weeks. Calculate the maximum inventory level L_Max.

• A) 32,000
• B) 31,800
• C) 31,600
• D) 31,400

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Definitions:

Pretax Return

The income a company generates before any taxes are subtracted.

Working Capital

The gap between an organization's current assets and its current liabilities, reflecting the business's short-term fiscal stability and operational effectiveness.

Salvage Value

The projected sales value of an asset at the termination of its effective life.

Financially Attractive

Describes opportunities or investments that are likely to provide a good return or prove to be profitable.