Exhibit 12.3 The Following Questions Use the Information Below

question 73

Multiple Choice

Exhibit 12.3
The following questions use the information below.
An auto parts store wants to simulate its inventory system for engine oil. The company has collected data on the shipping time for oil and the daily demand for cases of oil. A case of oil generates a $10 profit. Customers can buy oil at any auto parts store so there are no backorders (the company loses the sale and profit) . The company orders 30 cases whenever the inventory position falls below the reorder point of 15 cases. Orders are placed at the beginning of the day and delivered at the beginning of the day so the oil is available on the arrival day. An average service level of 99% is desired. The following spreadsheets have been developed for this problem. The company has simulated 2 weeks of operation for their inventory system. The current level of on-hand inventory is 25 units and no orders are pending.
-Using the information in Exhibit 12.3, what formula should go in cell H3 to compute the service level?

• A) =SUM(G8:G21)/SUM(D8:D21)
• B) =SUM(D8:D21)/SUM(E8:E21)
• C) =SUM(E8:E21)/SUM(D8:D21)
• D) =SUM(F8:F21)/SUM(G8:G21)

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Definitions:

Enhancing Happiness

The process of implementing strategies or practices that aim to increase an individual's level of happiness and well-being.

Reasonable Outcomes

Anticipated results or consequences of an action that are sensible and realistic based on the given conditions.

Happiness

A state of well-being and contentment characterized by emotions ranging from contentment to intense joy.

Satisfied Employees

Workers who feel content, fulfilled and happy with their job and workplace conditions.