Zee Bhd practices proper inventory control to maintain its inventory at the optimum level.Material A is one of the inventory items purchased by the company. The re-order level ofMaterial A is 1,500 kilograms and the re-order quantity is 1,300 kilograms. The lead time andusage are as follows:Lead time:Usage:Minimum1 weekMinimum600 kilograms per weekMaximum 800 kilograms per weekAverage1.5 weeksMaximum2 weeksRequired to calculate for Material A:a. Minimum stock levelb. Maximum stock level, andc. Average stock level.

solution minimum stock level =reorder level – (average usage * average lead time)…

ee Bhd practices proper inventory control to maintain its inventory at the optimum leve laterial A is one of the inventory items purchased by the company. The re-order level o laterial A is 1,500 kilograms and the re-order quantity is 1,300 kilograms. The lead time an sage are as follows: ead time: Usage: Minimum 1 week Minimum 600 kilograms per week 800 kilograms per week Average 1.5 weeks Maximum Maximum 2 weeks Required to calculate for Material A: 1. Minimum stock level Maximum stock lovol and

ee Bhd practices proper inventory control to maintain its inventory at the optimum leve laterial A is one of the inventory items purchased by the company. The re-order level o laterial A is 1,500 kilograms and the re-order quantity is 1,300 kilograms. The lead time an sage are as follows: ead time: Usage: Minimum 1 week Minimum 600 kilograms per week 800 kilograms per week Average 1.5 weeks Maximum Maximum 2 weeks Required to calculate for Material A: 1. Minimum stock level Maximum stock lovol and

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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