National Industries has a large manufacturing facility in Central Africa. The company keeps the needed items...
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National Industries has a large manufacturing facility in Central Africa. The company keeps the needed items in stock in its warehouse. Table T4 lists the total items the company keeps in stock, with the annual usage and the unit item cost. Item BV-1221 BV-1364 CD-1292 DF-1384 EZ-1357 HK-1329 HQ-1212 IV-1224 JQ-1387 LQ-1298 OL-1359 PB-1218 RB-1328 TL-1250 TV-1283 UB-1326 UC-1306 WD-1292 YO-1318 ZU-1372 Table T4 Annual Usage 5400 1300 5900 24 70 560 970 1700 14700 14200 80 35 1900 8100 12 360 6000 16100 3100 28000 Unit item cost (OMR) 530 520 40 7000 2700 720 650 470 100 1310 1510 4000 350 80 6500 360 360 1200 3100 120 The Finance Manager feels that the company has not formulated a proper inventory policy to minimize the inventory costs. a. Categorize the items in the company stock as Class A, B and C based on the 70-20-10 rule. (15 Marks) b. Prepare a Pareto Chart showing the three classes of stock. National Industries has a large manufacturing facility in Central Africa. The company keeps the needed items in stock in its warehouse. Table T4 lists the total items the company keeps in stock, with the annual usage and the unit item cost. Item BV-1221 BV-1364 CD-1292 DF-1384 EZ-1357 HK-1329 HQ-1212 IV-1224 JQ-1387 LQ-1298 OL-1359 PB-1218 RB-1328 TL-1250 TV-1283 UB-1326 UC-1306 WD-1292 YO-1318 ZU-1372 Table T4 Annual Usage 5400 1300 5900 24 70 560 970 1700 14700 14200 80 35 1900 8100 12 360 6000 16100 3100 28000 Unit item cost (OMR) 530 520 40 7000 2700 720 650 470 100 1310 1510 4000 350 80 6500 360 360 1200 3100 120 The Finance Manager feels that the company has not formulated a proper inventory policy to minimize the inventory costs. a. Categorize the items in the company stock as Class A, B and C based on the 70-20-10 rule. (15 Marks) b. Prepare a Pareto Chart showing the three classes of stock.
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The given task involves categorizing inventory items into three classes A B and C based on the 702010 rule and preparing a Pareto chart to visualize t... View the full answer
Related Book For
Core Concepts Of Accounting Information Systems
ISBN: 9780470507025
11th Edition
Authors: Nancy A. Bagranoff, Mark G. Simkin, Carolyn Strand Norman
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