Cost and Management AccountingMCQQuestion 6145 of 249
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4. Assuming that the company is willing to take a 5% risk of being out of stock what would be the safety stock and Re-order point?

Select Your Answer (Keyboard: A, B, C, D)
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Correct Answer

✅ Option A — Safety stock 1100 batteries and Re-order point 2800 batteries

All Options:

  • ASafety stock 1100 batteries and Re-order point 2800 batteries ✓
  • BSafety stock 1350 batteries and Re-order point 2550 batteries
  • CSafety stock 1280 batteries and Re-order point 2900 batteries
  • DSafety stock 1550 batteries and Re-order point 3280 batteries

Detailed Solution & Explanation

Correct Answer: Option **A** Explanation: As per the official suggested answer, option **A** is correct. Hence, **Option A** is the correct answer.

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