A leading automobile company based in Japan, which makes automobile parts has the following average annual...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
A leading automobile company based in Japan, which makes automobile parts has the following average annual inventory level, as given in Table T2 a. To have a more proper control over the inventory the company needs to do A-B-C analysis based on the annual consumption value. Item Chassis Axle Clutch Steering wheel Brake pad Head light Dashboard Mud flap Wheels Front bumper Machine screw Rear bumper Annual Number of Cost per Unit Units Sold (*) 58.50 34.80 16.60 43.60 11.00 27.00 38.00 9.40 25.40 47.00 6.50 44.00 36,000 89,000 47,000 21,000 40,000 60,000 20,000 12,000 103,000 18,000 22,000 12,000 Annual Consumption Value (2) 2,106,000.00 3,097,200.00 b. Prepare a Pareto Chart with the above information. 780,200.00 915,600.00 440,000.00 1,620,000.00 760,000.00 112,800.00 2,616,200.00 846,000.00 143,000.00 528,000.00 Table T2a - Average Annual Inventory a. Classify the inventory based on the A-B-C analysis and classify the items based on 70-20- 10 rule. (10 Marks) (05 Marks) c. Suggest 5 benefits of using ABC analysis for your inventory management with clear justification. (10 Marks) A leading automobile company based in Japan, which makes automobile parts has the following average annual inventory level, as given in Table T2 a. To have a more proper control over the inventory the company needs to do A-B-C analysis based on the annual consumption value. Item Chassis Axle Clutch Steering wheel Brake pad Head light Dashboard Mud flap Wheels Front bumper Machine screw Rear bumper Annual Number of Cost per Unit Units Sold (*) 58.50 34.80 16.60 43.60 11.00 27.00 38.00 9.40 25.40 47.00 6.50 44.00 36,000 89,000 47,000 21,000 40,000 60,000 20,000 12,000 103,000 18,000 22,000 12,000 Annual Consumption Value (2) 2,106,000.00 3,097,200.00 b. Prepare a Pareto Chart with the above information. 780,200.00 915,600.00 440,000.00 1,620,000.00 760,000.00 112,800.00 2,616,200.00 846,000.00 143,000.00 528,000.00 Table T2a - Average Annual Inventory a. Classify the inventory based on the A-B-C analysis and classify the items based on 70-20- 10 rule. (10 Marks) (05 Marks) c. Suggest 5 benefits of using ABC analysis for your inventory management with clear justification. (10 Marks)
Expert Answer:
Related Book For
Financial Reporting and Analysis
ISBN: 978-0078025679
6th edition
Authors: Flawrence Revsine, Daniel Collins, Bruce, Mittelstaedt, Leon
Posted Date:
Students also viewed these accounting questions
-
You have the following information related to Chalmers Corporations pension plan: 1. Defined benefit, noncontributory pension plan. 2. Plan initiation, January 1, 2014 (no credit given for prior...
-
You have the following information related to Chalmers Corporation's pension plan: 1. Defined benefit, noncontributory pension plan. 2. Plan initiation, January 1, 2017 (no credit given for prior...
-
You have the following information for Bernelli Diamonds. Bernelli Diamonds uses the periodic method of accounting for its inventory transactions. Bernelli only carries one brand and size of...
-
What are the final values of x and y? int x= 1, y=6; if(x>=1) if(y> 5){ X=X+2; y=y+2; } else{ X=X-1; y=y-1; } X=X+1; y=y+1;
-
How can poorly-designed performance measures contribute to poor employee performance? Can well-designed measures contribute to improving performance? Explain.
-
State the instructions of the function in words as in Example 8. (s) = 8 5s + s 2 Data from Example 8 The function f(x) = x 2 3x tells us to square the input, multiply the input by 3, and subtract...
-
In February 2014, defendant Ibrahim M. Shihadeh, d/b/a Creative Designs Kitchen and Baths, agreed to purchase 25% of his anticipated natural gas needs at a fixed price for the 201415 and 201516...
-
The Rentz Corporation is attempting to determine the optimal level of current assets for the coming year. Management expects sales to increase to approximately $2 million as a result of an asset...
-
How Safe Are You? Assume one of your favorite activities is mountain climbing. When you go mountain climbing, you have several safety devices to keep you from falling. You notice that attached to one...
-
The Garden Ornament Company manufactures two types of garden ornament a duck and a heron The information presented in Tables T1 to T5 has been prepared as a result of discussions by line managers for...
-
Let V = (2,-3,-2) and W =(-3,4,-1) be two vectors of the 3-space (IR') with the same 3. initial point. (a) Show that, by using the cross product, the vectors V and W are not parallel. (b) Find the...
-
Silver Water Motorworks produces small electric motors in lots of 200 with an average yield of 92%. Fifty per cent (50%) of the sub-standard output from the first run through, can be reworked. Direct...
-
Jaeger, Inc. bonds have a 6 . 4 5 % coupon rate with semiannual coupon payments. They have 1 6 years to maturity and a par value of $ 1 , 0 0 0 . What is the current yield of the bond if the bond is...
-
If I want to buy a $500,000 and can get a 30-year mortgage with an APR = 3.5%, what would my monthly payments be? If I can get a 15 year mortgage for 2.5%, how much would I save? I've checked with my...
-
Yuhao paid $220 for a used washing machine and dryer on Kijiji. He paid $85 to a moving company to pick up and deliver washer and dryer. These two events caused nominal GDP to increase by ?
-
Medical Lessors, Inc (MLI) buys an x-ray machine for $200K. On the same day (EOY 0), the firm leases the machine to Radiology, Inc. (RI) for six years, via a six-year, uniform-payment, annuity-due...
-
Kofas firms are always looking for methods to improve efficiency and effectiveness to compete globally. Some turn to mergers and acquisitions to survive. Thus, NewGold and Powell want to unite to...
-
a) Show that (a, b) := {{a}, {b}} does not satisfy the ordered pair axiom. b) Determine whether each of the following statements is true or false. (Give a reason in each case): (i) {a, b} C (a, b)....
-
On July 1, 2014, Pushway Corporation issued 100,000 shares of common stock in exchange for all of Stroker Companys common stock. The Pushway stock issued had a market value of $500,000 on the date of...
-
On April 1, 2014, Mills Company acquired equipment for $125,000. The estimated useful life is six years, and the estimated residual value is $5,000. Mills estimates that the equipment can produce...
-
Serven Corporation has estimated its accrual-basis revenue and expenses for June 2014 and would like your help in estimating cash disbursements. Selected data from these estimated amounts are as...
-
Assuming that the latent heat of sublimation of ice \(L_{\mathrm{S}}=2500 \mathrm{~kJ} / \mathrm{kg}\) is independent of temperature and the specific volume of the solid phase is negligible compared...
-
Calculate the slope of the solid-liquid transition line for water near the triple point \(T=273.16 \mathrm{~K}\), given that the latent heat of melting is \(80 \mathrm{cal} / \mathrm{g}\), the...
-
Study the state of equilibrium between a gaseous phase and an adsorbed phase in a singlecomponent system. Show that the pressure in the gaseous phase is given by the Langmuir equation \[...
Study smarter with the SolutionInn App