Lynn Fish opened a new beauty-products retail store. There are numerous items in inventory, and Lynn knows that there are costs associated with inventory. However, because her time is limited, she cannot carefully evaluate the inventory policy for all products. Lynn wants to classify the items according to dollars invested in them. The following table provides information about the 10 items that she carries:

Use ABC analysis to classify these items into categories A, B, cont’d and C.

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ITEM NUMBER E102 D23 D27 R02 R19 S107 S123 U11 U23 V75 UNIT COST $4 $8 $3 $2 $8 $6 $1 $7 $1 $4 DEMAND (UNITS) 800 1,200 700 1,000 200 500 1,200 800 1,500 1,500