Consider the Following Conditions for an Item Used in the Hess

question 116

Multiple Choice

Consider the following conditions for an item used in the Hess Company's manufacturing process: On-hand inventory: 40 units
Open orders (scheduled receipts) : 100 units
Backorders: 60 units
Reorder point: 100 units
Quantity per order: 50 units
Which of the following statements best describes Hess's situation regarding inventory replenishment?

• A)No action is required,since a scheduled receipt is due to be delivered to Hess.
• B)To cover its backorders,Hess should order two lots of 50 units.
• C)Because it is incurring backorders,Hess should increase its reorder point.
• D)Hess should place an order for 50 units,since the inventory position is less than the reorder point.

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Definitions:

Financial Cost

The total amount of money that is spent to produce goods or services, including materials, labor, and other expenses.

Resistance To Change

The opposition or pushback by individuals or groups when they perceive that a change that is occurring is a threat to them.

Role Patterns

Typical behaviors and expectations that define a person's function within a group or organization.

Learning

The acquisition of knowledge or skills through study, experience, or being taught, often leading to a change in behavior.