GFOA CPFO Exam - Topic 4 Question 86 Discussion

Actual exam question for GFOA's CPFO exam

Question #: 86
Topic #: 4

The city of Mudville uses 1600 oil filters annually. The cost of placing an order is $5.00. The unit cost is $3.50. The carrying cost is 20 percent, and the carrying cost per unit is &0.70(0.20x$3.50). And, there are 255 working days per year, and each order requires three working days of lead time. What is the reorder point?

A19

B17

C15

D18

Show Suggested Answer

Suggested Answer: C

by Ben at May 02, 2024, 08:55 PM

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Vernell

6 months ago

Totally agree, 18 makes sense with the math!

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Staci

6 months ago

1600 filters a year means about 6 a day, right?

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Allene

7 months ago

Wait, how did they get that number? Seems off.

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Erin

7 months ago

I think it's 18, seems right to me!

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Kimi

7 months ago

The reorder point is calculated based on lead time and daily usage.

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Maryln

7 months ago

I’m really unsure about the carrying cost part; does that affect the reorder point calculation directly?

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Allene

8 months ago

I feel like I’ve seen a similar question before, and I think the answer was around 18 or 19.

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Fernanda

8 months ago

I think the formula is just the daily usage times the lead time, but I can’t recall the exact numbers we used in practice.

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Billi

8 months ago

I remember we calculated reorder points in class, but I’m not sure if I got the lead time right.

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Arlean

8 months ago

Okay, I've got a strategy. I'll start by calculating the average daily usage, then use that to find the reorder point based on the lead time. If I get stuck, I'll refer back to my notes and try to break it down into smaller steps.

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Wilda

8 months ago

Ugh, I'm really struggling with this one. There are so many variables to consider, and I'm not confident I'm applying the right formulas. I might need to ask the instructor for some guidance on this type of problem.

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Howard

8 months ago

I think I've got this! The key is to find the daily usage rate, then multiply that by the lead time to get the reorder point. Let me work through the calculations step-by-step.

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Eleonore

8 months ago

Hmm, this is a lot of information to process. I'm not sure I fully understand how to calculate the reorder point. Maybe I should review the formulas for this type of problem before attempting it.

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Eve

8 months ago

Okay, this looks like a classic inventory management problem. I'll need to calculate the reorder point based on the given information about annual usage, order cost, unit cost, carrying cost, and lead time.

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Zita

8 months ago

This seems like a straightforward question about the default NIC-to-bridge mapping in Oracle VM. I'll go with option B.

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Lizbeth

8 months ago

Okay, I think I've got a good strategy here. I'll go with option B to use Power Automate to automatically send out the Customer Voice surveys. That should help automate the process and make it easier to collect and analyze the responses.

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Quentin

8 months ago

I'm not totally confident, but I think the emergency-management team is responsible for the initial disaster response, so I'll select that.

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Ardella

8 months ago

Hmm, I'm not totally sure about this one. The question mentions "current and future agreed demands", so I'm wondering if the Availability Plan (option A) might be the right answer since that's about ensuring availability to meet business needs.

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Kristel

8 months ago

For FCoE, it seems like VLT is important, but I'm not sure which options, A or E, are right for that setup.

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Willodean

1 year ago

This question is like a puzzle, and I love puzzles! Alright, let's see... the reorder point should be the demand during the lead time, which is 3 days. So we need to find the daily demand, which is 1600 / 255 = 6.27 units. Multiplying that by the 3-day lead time, we get 18.81 units, which rounds down to 18. D) 18 is the winner!

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Jesus

1 year ago

Yes, it makes sense to round down to 18 units for the reorder point.

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Oren

1 year ago

I agree, the reorder point should be 18 units.

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Arlyne

1 year ago

I think the answer is D) 18.

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Reena

1 year ago

I think the key to this question is understanding the concept of reorder point. The reorder point should be the demand during the lead time, which is 3 days. So the answer should be the daily demand multiplied by the lead time, which is 6.27 * 3 = 18.81, rounding down to 18. I'm going with D) 18.

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Nicholle

1 year ago

So the answer should be the daily demand multiplied by the lead time, which is 6.27 * 3 = 18.81, rounding down to 18. I'm going with D) 18.

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Tegan

1 year ago

The reorder point should be the demand during the lead time, which is 3 days.

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Ona

1 year ago

I think the key to this question is understanding the concept of reorder point.

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Boris

1 year ago

Haha, this question is like a word problem from a math textbook. I bet the answer is something like 17 or 18, just to make it a little tricky. I'm going with B) 17 because it's the middle option and I'm feeling lucky today.

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Lino

1 year ago

I'm not sure about this one. The question seems to have a lot of information, and I'm not sure how to put it all together. I'm going to go with D) 18 as my guess, but I'm not confident about it.

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Crista

1 year ago

B) 17

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Stephanie

1 year ago

A) 19

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Selma

1 year ago

I think the answer is C) 15. The reorder point should be the demand during the lead time, which is 3 days. Given the annual demand of 1600 and 255 working days per year, the daily demand is 1600/255 = 6.27 units. So the demand during the 3-day lead time is 6.27 * 3 = 18.81 units, rounding down to 15 units.

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