# Reorder Point

East value Distributors distributes industrial valves and control devices. The Eastern Valve Co. Has an annual demand of 20000 units and cost of $90 per unit. The cost of ordering is $100 per order and inventory-carrying cost is estimated to be 5 percent of the cost of each value. Lead-time is four working days. Determine(assuming 250 working days): The economic order quantity, the reorder point, the optimal number of orders per year, the optimal number of days between any two orders.

© BrainMass Inc. brainmass.com June 3, 2020, 4:49 pm ad1c9bdddfhttps://brainmass.com/statistics/descriptive-statistics/reorder-point-5224

#### Solution Preview

In this case, we have:

<br>D= annual demand=20000

<br>UC=Unit cost = 90

<br>OC=the cost of ordering=100

<br>IC= inventory-carrying cost=5%

<br>L= ...

#### Solution Summary

The solution discusses East Value Distributors distributes industrial valves and control devices. The Eastern Valve Co. Has an annual demand of 20000 units and cost of $90 per unit. The cost of ordering is $100 per order and inventory-carrying cost is estimated to be 5 percent of the cost of each value. Lead-time is four working days. Determine(assuming 250 working days): The economic order quantity, the reorder point, the optimal number of orders per year, the optimal number of days between any two orders.