Inventory Management: 1. The following table contains data about the inventory f
ID: 391760 • Letter: I
Question
Inventory Management:
1. The following table contains data about the inventory for five items at Jones Corporation. Complete the missing items in the table.
Item
Beginning Unite Inventory
Ending Unit
Inventory
Avg Unit Inventory
Annual Unit
Sales
Inventory Turnover
1
150,000
120,000
400,000
2
40,000
60,000
80,000
3
85,000
97,000
190,000
4
200,000
170,000
350,000
5
50,000
60,000
165,000
Total
2. Suppose Jones Corporation in the above problem determined that its annual inventory carrying cost= 18 percent. The item unit cost was as follows:
Item 1= $25.00
Item 2= $60.00
Item 3= $5.00
Item 4= $10.00
Item 5= $1.00
Compute the dollar values for the information on the above table and determine the annual inventory carrying cost for each item and the total annual inventory carrying cost.
3. Again, using the data for Jones Corporation in problem 2 and 3, suppose Jones believes that in the upcoming year, the rate of sales expected for each of the five items is as follows:
Item 1= 4,000 units per day
Item 2= 2000 units per day
Item 3 = 15,000 units per day
Item 4= 7,000 units per day
Item 5= 2000 units per day
Compute the days of supply for each item.
please show the full maths for each problem.
Item
Beginning Unite Inventory
Ending Unit
Inventory
Avg Unit Inventory
Annual Unit
Sales
Inventory Turnover
1
150,000
120,000
400,000
2
40,000
60,000
80,000
3
85,000
97,000
190,000
4
200,000
170,000
350,000
5
50,000
60,000
165,000
Total
Explanation / Answer
a. Complete the missing items in the table.
Item
Beginning Unit
Inventory
Ending Unit
Inventory
Average Unit
Inventory
Annual Unit
Sales
Inventory
Turnover
1
150,000
120,000
(150000+120000)/2 =135,000
400,000/135000
2.963
2
40,000
60,000
(40000+60000)/2= 50,000
80,000/50000
1.600
3
85,000
97,000
(85000+97000)/2=91,000
190,000/91000
2.088
4
200,000
170,000
(200000+170000)/2=185,000
350,000/185000
1.891
5
50,000
60,000
(50000+60000)/2= 55,000
165,000/55000
3.000
Total
525,000
507,000
(525000+507000)/2=516,000
1,185,000/516000
2.30
b. Suppose Jones Corporation in the above problem determined that its annual inventory carrying cost = 18%. The item unit cost was as follows:
Item 1 = $25.00
Item 2 = $60.00
Item 3 = $5.00
Item 4 = $10.00
Item 5 = $1.00
Compute the dollar values in the above table, determine the inventory carrying cost for each item, and the total annual inventory carrying cost.
Inventory carrying cost = (average unit inventory x cost per unit) x (carrying cost percentage)
Item 1 = (135,000 x $25) x 18% = $607,500
Item 2 = (50,000 x $60) x 18% = $540,000
Item 3 = (91,000 x $5) x 18% = $81,900
Item 4 = (185,000 x $10) x 18% = $333,000
Item 5 = (55,000 x $1) x 18% = $9,900
Total annual inventory carrying cost = $1,572,300
c. Again, using the data for Jones Company in Problem 2 and 3, suppose Jones believes that in the upcoming year, the rate of sales expected for each of the 5 items is as follows:
Item 1 = 4,000 units per day
Item 2 = 2,000 units per day
Item 3 = 15,000 units per day
Item 4 = 7,000 units per day
Item 5 = 2,000 units per day
Compute the days of supply for each item.
Days of supply: ending inventory/unit sales per day
Item 1 = 120,000/4,000 = 30 days
Item 2 = 60,000/2,000 = 30 days
Item 3 = 97,000/15,000 = 6.47 days
Item 4 = 170,000/7,000 = 24.29 days
Item 5 = 60,000/2,000 = 30 days
KINDLY RATE THE ANSWER AS THUMBS UP. THANKS A LOT.
Item
Beginning Unit
Inventory
Ending Unit
Inventory
Average Unit
Inventory
Annual Unit
Sales
Inventory
Turnover
1
150,000
120,000
(150000+120000)/2 =135,000
400,000/135000
2.963
2
40,000
60,000
(40000+60000)/2= 50,000
80,000/50000
1.600
3
85,000
97,000
(85000+97000)/2=91,000
190,000/91000
2.088
4
200,000
170,000
(200000+170000)/2=185,000
350,000/185000
1.891
5
50,000
60,000
(50000+60000)/2= 55,000
165,000/55000
3.000
Total
525,000
507,000
(525000+507000)/2=516,000
1,185,000/516000
2.30
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