Question: Why does total system inventory increase as a company increases
Why does total system inventory increase as a company increases its number of stocking locations?
Answer to relevant QuestionsEarly in the chapter it was stated that planning inventory levels is both an art and a science. Explain in your own words why this is true. Akers Inc. maintains average inventory of $1,000,000 (at cost). Last year, Akers sales volume was $10,000,000 and cost of goods sold was $7,000,000. Akers has determined that its inventory carrying cost is 15% annually. What ...Suppose Johnson Plastics (in solved problem 5) reduces setup cost to $20. Rework the problem. The supplier in the above scenario now decides to offer a volume discount. They will sell the crystal figurines at $8 per unit for orders of 250 units or more. Answer the same set of questions. After you reduce your order cost, as described in problem 24, the supplier in problem 13 changed its pricing policy to a standard $4.75 per unit, regardless of the order quantity. What would be the impact on all other ...
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