Purchase order lead time is multiplied to number of units is sold per unit of time to calculate

A. carrying costs

B. relevant total costs

C. economic order quantity

D. reorder point

Answer: Option D

Solution(By Examveda Team)

Purchase order lead time is multiplied to number of units is sold per unit of time to calculate reorder point. The reorder point (ROP) is the level of inventory which triggers an action to replenish that particular inventory stock.