Accounting for Materials – Safety Inventory

This topic has 1 reply, 2 voices, and was last updated 11 years ago by Farzana sultana.

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February 5, 2015 at 8:54 am #225311
Vicki
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Hi,

I am struggling with which formula to use to answer this question, also what is meant by ‘safety inventory’? please can you help?

“For a particular component, the re-order quantity is 6000 units and the average inventory holding is 3,400 units.

What is the level of safety inventory (in whole units)?
February 10, 2015 at 1:03 am #227479
Farzana sultana
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The answer should b 400.the formula is
Average inventory=(Q/2+safety inventory)
If u go through with this u can hv ur answer.
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