Asked by Vishaldeep Singh on Jun 17, 2024
Verified
A company that tracks inventory and places an order for a lot size Q when the inventory declines to the reorder point (ROP) is using
A) continuous review.
B) daily review.
C) occasional review.
D) periodic review.
Continuous Review
A system of inventory management where the stock levels are continuously monitored, and orders are placed as soon as the inventory drops below a predetermined level.
Reorder Point (ROP)
The inventory level at which an order should be placed to replenish stock before it runs out, ensuring a balance between stock availability and minimal holding costs.
Lot Size
The quantity of items processed or procured in a single order or batch, affecting inventory levels and production efficiency.
- Gain insight into the function of inventory review strategies, including continuous and periodic review, and their effects on stock quantities and order sequences.
Verified Answer
Learning Objectives
- Gain insight into the function of inventory review strategies, including continuous and periodic review, and their effects on stock quantities and order sequences.
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