APICS Certified Supply Chain Professional (CSCP) — Question 78

A company that sells 60 units of product in a given year and has an average quantity on hand of 10 units. There are 360 selling days and 261 production days in the year. The company has on hand how many days of product inventory?

Answer options

• A. 0.16
• B. 0.23
• C. 43
• D. 60

Correct answer: D

Explanation

The company has 10 units in inventory and sells 60 units annually, which translates to an inventory that lasts for 60 days. Therefore, the correct answer is D, as the inventory on hand is sufficient for 60 days of sales. The other options do not accurately reflect the calculation of days of inventory based on the given sales and stock levels.