Solve problems #3 and #7 pages 517 and 518:

3. Jack Jones, the materials manager at Precision Enterprises, is beginning to look for ways to reduce inventories. A recent accounting statement shows the following inventory investment by category: raw materials, $3,129,500; work-in-process, $6,237,000; and finished goods, $2,686,500. This year's cost of goods sold will be about $32.5 million. Assuming 52 business weeks per year, express total inventory as a. Weeks of supply b. Inventory turns 7. Sapphire Aerospace operates 52 weeks per year, and its cost of goods sold last year was $6,500,000. The firm carries eight items in inventory: four raw materials, two work-in-process items, and two finished goods. Table 12.3 shows last year's average inventory levels for these items, along with their unit values. a. What is the average aggregate inventory value? b. How many weeks of supply does the firm have? C. What was the inventory turnover last year? 5 TABLE 12.3 SAPPHIRE AEROSPACE INVENTORY ITEMS Category Part Number Average Inventory Units Value per Unit Raw materials RM-1 20,000 $1 RM-2 5,000 5 RM-3 3,000 6 RM-4 1,000 8 Work-in-process WIP-1 6,000 10 WIP-2 8,000 12 Finished goods FG-1 1,000 65 FG-2 500 88