Manis Berhad is a company that produces children toys for domestic and overseas market. One of the main raw materials used in the production is the synthetic rubber and the source of the material is from the country of the United States of America. There is a lead time of two weeks between the placing of an order and delivery of the goods to the factory plant since the raw materials is ordered through shipment. The production manager of the company has confirmed that the factory works for 50 weeks in a year. The average usage of synthetic rubber is 10,000 units per week. The average unit price of the synthetic rubber is RM42 per kg. The holding cost for the inventory is 40 percent of the purchase price including the insurance costs and financing costs. The cost of ordering the synthetic rubber is fixed at RM200 per order. The company is considering a stock management system based on the economic order quantity (EOQ) model. Besides, the Managing Director suggested that the company should source supplies of synthetic rubber from many suppliers, locally and overseas. He also suggested that the stockholdings of the company should be reduced since the assembly department needed more space. Required: Determine the optimum order level of stock for Manis Berhad. (Round your answers to the nearest kg). а.

Fringe benefits are in addition to the compensation that companies give to their employees. It is an additional benefit above the stated salary. It helps to keep the employees of the firm motivated as sometimes the only salary is not enough to retain the…