As part of its commitment to quality, the J. J. Borden manufacturing company is proposing to introduce just-in-time (JIT) production methods. Managers of the company have an intuitive feel regarding the financial benefits associated with a change to JIT, but they would like to have some data to inform their decision making in this regard. You are provided with the following data:

Required
As the management accountant for the company, construct an Excel spreadsheet that can be used to estimate the financial benefits associated with the adoption of JIT.

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tem Existing Situation After Adopting JIT Manufacturing Costs as Percentage of Sales: Product-level support costs Variable manufacturing overhead Direct materials Direct manufacturing labor 12% 28 30 10 20 15 Other Financial Data: Sales revenue $1,350,000 180,000 $1,650,000 30,000 Inventory of WIP Other Data: Manufacturing cycle time Inventory financing cost (per annum) 60 days 10% 30 days 10%