Page 571 Reorder Point (ROP):UnderCertainty)asunitstimesame(intimeLeadLTper week)day,perperiod,per(unitsrateDemandwhereLTROPddd==×=Chapter 12Inventory ManagementReorder Point=When the quantity on hand of an item drops to this amount,the item is reordered.
Tingly takes a Two-a-Day vitamins, which are delivered to his home by a routeman seven days after an order is called in. Annual usage is 730 tablets, ordering cost per order is $1, and inventory carrying cost is $2 per tablet per year. (a) What is the fixed order quantity (EOQ)? (b) At what point should Tingly reorder? )