Inventory Turnover Ratio

Calculate inventory turnover using the below data:

Smith's Ltd. sells sporting goods for local sports leagues. During the current year, Smith's reported cost of goods sold on its income statement of $1,000,000. Smith's beginning inventory was $3,000,000 and its ending inventory was $4,000,000.

Annual Holding Cost

Calculate the annual holding cost based on the below data:

EOQ = use EOQ from Lesson 2 Tasks

Average Inventory = use data from Lesson 7 (inventory turnover ratio)

Smith's holding cost per unit = $2

ABC Analysis

Calculate demand cost, % of total cost, and then classify the item # based on the data below:

Item #	Item Cost	Annual Demand	Demand Cost	% of Total Cost	Class
234	$6.57	50
239	$10.09	10
244	$13.61	100
249	$17.13	50
254	$20.65	15
259	$24.17	50
264	$27.69	10
269	$31.21	100
274	$34.73	50
279	$38.25	15
284	$41.77	100
289	$45.29	50
294	$48.81	15
299	$52.33	50
304	$55.85	10

Optimal Order Quantity

Calculate optimal order quantity using the information below:

Smith's Ltd. Has an annual demand of 1120 soccer balls. Their ordering cost is $2 per order. Their holding cost is found in Lesson 7 Task above