Exhibit 28.2 Cartwright Computing Expects to Order 126,000 Memory Chips for Inventory

question 27

Multiple Choice

Exhibit 28.2
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 28.2.If Cartwright holds a safety stock equal to a 30-day supply of chips,what is its average inventory level?

• A) 12,088
• B) 3,175
• C) 15,750
• D) 13,675
• E) 8,124

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Definitions:

ATP Synthesis

The process by which cells produce ATP (adenosine triphosphate), involving the transfer of electrons through the electron transport chain and ATP synthase.

Kidney Tubule

A tiny tube in the kidney where urine is formed after filtration, consisting of the proximal tubule, loop of Henle, and distal tubule.

Proteases

Enzymes that catalyze the breakdown of proteins into smaller peptides or amino acids by cleaving peptide bonds.

ER Lumen

The inner compartment of the endoplasmic reticulum, a crucial organelle in eukaryotic cells, involved in protein synthesis and maturation.