Category: Business and Money
Asked by: csalmon74-ga
List Price: $2.00
01 Mar 2005 06:32 PST
Expires: 31 Mar 2005 06:32 PST
Question ID: 482853
If the beginning inventory is 500 units, the demand forecast is 1,000, and the necessary safety stock is 10% of the demand forecast, which of the following is the production requirement?
Answered By: omnivorous-ga on 01 Mar 2005 07:29 PST
Csalmon -- With no safety stock, the demand forecast would put production at 500 units (1,000 demand - 500 inventory). But you've added a safety stock of 10% of demand, which equals 100 units. So, production requirement = 600 units. Best regards, Omnivorous-GA
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