Question: Oakwood Hospital is considering using ABC analysis to classify laboratory SKUs into three categories: those that will be delivered daily from their supplier (Class A

Oakwood Hospital is considering using ABC analysis to classify laboratory SKUs into three categories: those that will be delivered daily from their supplier (Class A items), those that will be controlled using a continuous review system (B items), and those that will be held in a two bin system (C items). The following table shows the annual dollar usage for a sample of eight SKUs. Rank the SKUs, and assign them to their appropriatecategory.

SKU Dollar Value $0.01 $0.03 $0.45 $1.00 $4.50 $0.90 $0.30 $1.50 Annual Usage 1,200 120,000 100 44,000 900 350 70,000 200 6

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