AberwaldAberwald Corporation 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% of the purchase price. (Assume a 360-day year.)
-Refer to Scenario: Aberwald.If Aberwald holds a safety stock equal to a 30-day supply of chips,what is its average inventory level?
A)3,175
B)12,088
C)13,675
D)15,750

Question

Quizplus · Accepted Answer

The Answer of AberwaldAberwald Corporation 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% of the purchase price. (Assume a 360-day year.)
-Refer to Scenario: Aberwald.If Aberwald holds a safety stock equal to a 30-day supply of chips,what is its average inventory level?
A)3,175
B)12,088
C)13,675
D)15,750

AberwaldAberwald Corporation Expects to Order 126,000 Memory Chips for Inventory