HW 12 - 12.2 You decide that the top 20% of the 10 items,...

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Unformatted text preview: 12.2 You decide that the top 20% of the 10 items, based on a criterion of demand times cost per unit, should be A items. (In this example, the top 20% constitutes only 58% of the total inventory value, but in larger samples the value would probably approach 70% to 80%.) You therefore rate items F3 and G2 as A items. The next 30% of the items are A2, C7, and D1; they represent 23% of the value and are categorized as B items. The remaining 50% of the items (items B8, E9, H2, I5, and J8) represent 19% of the value and become C items. Annual Item Demand Cost ($) Demand × Cost Classification A2 3,000 50 150,000 B B8 4,000 12 48,000 C C7 1,500 45 67,500 B D1 6,000 10 60,000 B E9 1,000 20 20,000 C F3 500 500 250,000 A G2 300 1,500 450,000 A H2 600 20 12,000 C I5 1,750 10 17,500 C J8 2,500 5 12,500 C 12.3 Inventory Item $Value per Case #Ordered per Week Total $ Value/Week (52 Weeks) Total ($*Weeks) Rank Percent of Inventory Cumulative Percent of Inventory Fish filets 143 10 $1,430 $74,360 1 17.54% 34.43% French fries 43 32 $1,376 $71,552 2 16.88% 47.31% Chickens 75 14 $1,050 $54,600 3 12.88% 59.53% Prime rib 166 6 $996 $51,792 4 12.22% 69.83% Lettuce (case) 35 24 $840 $43,680 5 10.31% 78.85% Lobster tail 245 3 $735 $38,220 6 9.02% 83.82% Rib eye steak 135 3 $405 $21,060 7 4.97% 87.25% Bacon 56 5 $280 $14,560...
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This note was uploaded on 11/15/2009 for the course BUSQOM 1070 taught by Professor Shang during the Fall '09 term at Pittsburgh.

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HW 12 - 12.2 You decide that the top 20% of the 10 items,...

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