"Accessed In$-$Class Exercise $3$: INVENTORY

This is a group In$-$Class assignment, which will be assessed $(4\%)."$

Scenario

JANZ Corporation, a major producer of consumer electronics equipment, is currently faced with a rapidly growing product line and its associated inventory problems. JANZ$$s president, Jan Muhammad, has decided to initiate a program to analyze the company$$s inventory requirements utilizing different inventory techniques. The first phase of this program consists of an ABC analysis of the company$$s product line $($shown in the following table$).$ Mr$.$ Jan has encountered difficulties in deciding on the appropriate criteria to use in the classification and in developing appropriate cutoff levels for each class of inventory. To solve his dilemma, Mr$.$ Jan has contracted the services of a logistics$-$consulting firm to perform the inventory analysis.

SALES DATA $($ONE$-$YEAR PERIOD$)$

PRODUCT # UNITS SOLD "PRICE PER UNIT

$($$$)"$ "PROFIT PER UNIT

$($$$)"$

SR$10115,00025050\mathrm{.}50$

SR$1037501,500330\mathrm{.}00$

SR$1051,60060090\mathrm{.}00$

SR$201452,250877\mathrm{.}50$

SR$203103,5001,750\mathrm{.}00$

SR$2059,250500125\mathrm{.}00$

SR$301700650195\mathrm{.}00$

SR$303550700196\mathrm{.}00$

SR$3053,000920303\mathrm{.}60$

SR$5001001,100440\mathrm{.}00$

"Tasks

$1.$ If the consulting firm employed you, how would you construct your method of analysis? What criteria would you use? What would be cutoff levels be$?$ Be sure to provide explanations of the reasoning supporting your decisions like why you choose the percentages for ABC analysis. A good way is to conduct ABC analysis using different ways and then compare and contrast them and then make the recommendatio n$.$

$2.$ Submit soft copy $($you can use Excel or Word$)$ to Brightspace $($D$2$L $$ AICE$-3$: Inventory$)$ by $11\mathrm{.}59$pm Mar $012024.$ Expectations are that the report will show the analysis performed to do the ABC analysis with items sorted accordingly in ABC sequence, clearly demonstrating the criteria used; furthermore, any additional criteria, based on your observations, should be highlighted with a recommendation to management on what to do with these items."