Exhibit 23.2 Cartwright Computing Expects to Order 126,000 Memory Chips for Inventory

question 16

Multiple Choice

Exhibit 23.2
Cartwright Computing expects to order 126,000 memory chips for inventory during the coming year, and it will use this inventory at a constant rate. Fixed ordering costs are $200 per order; the purchase price per chip is $25; and the firm's inventory carrying costs is equal to 20 percent of the purchase price. (Assume a 360-day year.)
-Refer to Exhibit 23.2.Assume that Cartwright holds a safety stock equal to a 30-day supply of chips.What is the maximum amount of inventory that will have on hand at any time,that is,what will be the inventory level right after a delivery is made?

• A)9,216
• B)3,175
• C)6,243
• D)13,675
• E)8,124

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