"Calculate re-order level from the following:
Safety stock: 1000 units
Consumption per week: 500 units
It takes 12 weeks to reach material from the date of ordering"
A. 1000 units
B. 6000 units
C. 3000 units
D. 7000 units
Answer: Option D
Solution(By Examveda Team)
Re-order level = Safety stock + Total consumption= 1000 + (500 × 12) = 1000 + 6000 = 7000 units.
Related Questions on Costing
Basic objective of cost accounting is ________
A. tax compliance.
B. financial audit.
C. cost ascertainment.
D. profit analysis.
Process costing is suitable for ________.
A. hospitals
B. oil refing firms
C. transport firms
D. brick laying firms
The cost which is to be incurred even when a business unit is closed is a _____.
A. imputed cost
B. historical cost
C. sunk cost
D. shutdown cost
Join The Discussion