The quantity on hand that will trigger an order to buy more items. A company’s reorder point for Product X might be 80 units. When the quantity on hand gets down to 80, a purchase order is prepared to obtain more of these items.
Featured Review
"As a Finance Director, AccountingCoach has helped me remain up-to-date, refreshing my knowledge after more than 10 years out of school, and updating me with new concepts and how to apply them to my job. I couldn't imagine all the benefits one could enjoy becoming a member of AccountingCoach. Thank you for being there, keep it up!" - Joel N.
Join PRO or PRO Plus and Get Lifetime Access to Our Premium Materials
Read all 2,645 reviewsWe now offer 10 Certificates of Achievement for Introductory Accounting and Bookkeeping: