12. An physician practice center uses an average of ten boxes of gloves (50-gloves per box) per day, and replenishment lead times average three days. Because both the usage and lead times are highly variable, the office carries a safety of five boxes. An order should be placed when how many boxes are left (i.e., what is the re-order point)?Single choice
A
30 boxes
B
35 boxes
C
50 boxes
D
10 boxes

Question

12. An physician practice center uses an average of ten boxes of gloves (50-gloves per box) per day, and replenishment lead times average three days. Because both the usage and lead times are highly variable, the office carries a safety of five boxes. An order should be placed when how many boxes are left (i.e., what is the re-order point)?Single choice

A

30 boxes

B

35 boxes

C

50 boxes

D

10 boxes

BlackTom AI · Accepted Answer

Reorder point (ROP) equals demand during lead time plus safety stock.

1. Relevant knowledge points and concepts
- ROP is the inventory level at which a new order should be placed to avoid stockouts during replenishment.
- Formula: ROP = (average daily demand × average lead time in days) + safety stock.
- Safety stock compensates for variability in demand and/or lead time.

2. Step-by-step reasoning
- Average usage is given as 10 boxes per day.
- Average replenishment lead time is 3 days.
- Safety stock carried is 5 boxes.
- First compute demand during lead time: multiply average daily usage by lead time.

3. Calculations (all intermediate steps)
- Demand during lead time = 10 boxes/day × 3 days
- Demand during lead time = 30 boxes
- Add safety stock: ROP = 30 boxes + 5 boxes
- ROP = 35 boxes

4. Why the correct answer is correct
- The ROP of 35 boxes ensures the practice has the 30 boxes expected to be consumed while waiting for a replenishment order plus an extra 5-box buffer to cover variability in either usage or lead time. This aligns exactly with the established inventory control formula and the given numerical values.

5. Why the other choices are incorrect
- 30 boxes: This equals demand during lead time but omits the required safety stock, risking stockouts when variability occurs.
- 50 boxes: This is larger than needed; one possible mistaken interpretation is multiplying 10 boxes by 5 (safety) or confusing gloves per box, but it does not follow the correct ROP formula for provided data.
- 10 boxes: This equals one day’s usage, not the reorder point based on lead time and safety stock.