What is the order point of stewed tomatoes if 3 cases are used each day, 5 cases are needed as safety stock, and 7 days are needed for delivery from the time an order is placed?
  1. 30 cases
  2. 18 cases
  3. 26 cases
  4. 36 cases
Explanation
Answer: C - The order point, the point at which more stock must be ordered, is 26 cases, calculated from the following formula:

(daily use)(lead time) + safety stock =
(3 cases x 7 days) = 5 cases = 26 cases
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