Eal Company Has the Following Information Available Concerning One of Its

question 58

Multiple Choice

eal Company has the following information available concerning one of its inventory items:
$\begin{array}{lr}\text { Cost of placing an order } & \$ 32.00 \\\text { Unit carrying cost per year } & \$ 4.00 \\\text { Annual unit demand } & 5,625 \\\text { Safety stock } & 100 \\\text { Average daily demand } & 25 \\\text { Normal lead time in days } & 10\end{array}$

-Refer to the figure.If there is a delay in shipping the item,approximately how many days can be covered by the safety stock?

• A)4 days
• B)25 days
• C)30 days
• D)100 days

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Definitions:

Restrictive Endorsement

A limitation placed on the use of a check that specifies the conditions under which the check can be endorsed or cashed.

Negotiable

Refers to something that can be transferred from one party to another, commonly used in the context of financial instruments that can be exchanged or sold.

Holder in Due Course

A legal term that refers to a person who has acquired a negotiable instrument in good faith and for value, thereby having certain rights to payment.

Transferred

The act of moving or shifting ownership, rights, or possession from one entity to another.