A company operates a medium size warehouse where it stocks FMCG items. Wages for the purchasing...
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A company operates a medium size warehouse where it stocks FMCG items. Wages for the purchasing department are R36 000, purchasing expenses are R25 000. It costs the company R25,00 to place an order. The cost of financing the inventory is 12% and the storage costs are estimated to be 8% with risk costs at 6%. The average inventory is R275 000, and 5 000 orders are placed each year. Determine (separately) the ordering and carrying costs for this inventory. What are the total costs? What actions could the company take to reduce these costs? A company has classified its inventory into ABC items. They have decided that A items are to be counted each month, B items four times a year and C item only once a year. From a recently conducted ABC analysis, the following quantities and classifications were established. A items 200 B items C items 300 Develop a schedule of the counts for each class of item. If the company operates a 250- day year, how many items need to be counted cach day. Three associates are employed in the store. Do you think the load is reasonable? A company operates a medium size warehouse where it stocks FMCG items. Wages for the purchasing department are R36 000, purchasing expenses are R25 000. It costs the company R25,00 to place an order. The cost of financing the inventory is 12% and the storage costs are estimated to be 8% with risk costs at 6%. The average inventory is R275 000, and 5 000 orders are placed each year. Determine (separately) the ordering and carrying costs for this inventory. What are the total costs? What actions could the company take to reduce these costs? A company has classified its inventory into ABC items. They have decided that A items are to be counted each month, B items four times a year and C item only once a year. From a recently conducted ABC analysis, the following quantities and classifications were established. A items 200 B items C items 300 Develop a schedule of the counts for each class of item. If the company operates a 250- day year, how many items need to be counted cach day. Three associates are employed in the store. Do you think the load is reasonable?
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Part 1 Part 2 A items to be counted each month This means twelve times a year Count of A ... View the full answer
Related Book For
Fundamental Managerial Accounting Concepts
ISBN: 978-0078025655
7th edition
Authors: Thomas Edmonds, Christopher Edmonds, Bor-Yi Tsay, Philip Old
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