In a Periodic Review System, If You Are Basing Your

question 109

Multiple Choice

In a periodic review system, if you are basing your time between orders on the EOQ, what should be its length in weeks?

• A) EOQ / 52
• B) EOQ / average weekly demand
• C) average weekly demand / EOQ
• D) 52 / EOQ
• E) (EOQ)(average weekly demand)

---

Definitions:

Direct Materials

Basic substances used explicitly in the manufacturing of certain products or services.

Production Budget

A financial plan that outlines the cost of producing the goods or services a company plans to sell, including direct labor, materials, and overhead.

Denim Material

A durable, woven fabric commonly used for making jeans and other clothing items, characterized by its indigo blue color.

Budgeted Production

The planned amount of goods to be produced over a certain period, often based on demand forecasts.