Reference no: EM132550706

La Zana in Sydney's North Shore is a popular pizza place offering a variety of pizzas at a reasonable price. The pizza place prepares all the meals on the menu in-house, however sources its pizza sauce from a supplier. Annually, La Zana requires 14,400 bottles of pizza sauce. Over the past year, the La Zana found that the daily demand fluctuates between 26 and 78 sauce bottles. Each pizza sauce bottle costs $ 2.50 and the supplier shop requires 4 days from the time of receiving the order to delivering the pizza sauce. The pizza place is open for 200 days in a year. The owner prefers to keep some pizza sauce bottles in inventory at all times, taking into account the fluctuating demand. The ordering cost for each order is $ 12 and the annual carrying cost of the pizza sauce bottles is 1 cent per bottle.

Question 1: The Safety Stock for the Pizza bottles is :

Select one:

Option a. 24 bottles

Option b. 48 bottles

Option c. 30 bottles

Option d. 12 bottles