A Company Distributes Repair Parts for High-End Appliances

question 67

Short Answer

A company distributes repair parts for high-end appliances. The annual demand is 81,000 and the company operates 300 days per year. The annual carrying cost is 20% of the item cost, which is $500. The ordering cost is estimated at $60 and the shortage cost is $150.
-If the daily demand is 30 and the lead time in days is 3, what is the reorder point?

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Definitions:

Reciprocity

A social norm of responding to a positive action with another positive action, fostering positive relations among individuals.

Research Survey

A systematic method of collecting information from individuals, typically by asking them questions through interviews or questionnaires, to gather data for analysis.

Source Credibility

The perceived trustworthiness, expertise, and reliability of the sender of information.

Competent

Having the necessary ability, knowledge, or skill to do something successfully.