Quiz_ Abbey case quiz

Quiz_ Abbey case quiz - uiz Abbey case quiz

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Abbey case quiz Submitted by cmd5150 on 3/19/2010 9:12:37 PM Points Awarded 10 Points Missed 0 Percentage 100% 1. What is the total inventory level in dollars? You can calculate this based on data given in the case. .. hint: annual inventory carrying cost = total inventory * carrying cost percentage. (SHOW YOUR CALCULATIONS) Points Earned: 2/2 Correct Answer: 2.5 million = X * 20% X = 12.5 million dollars Total inventory level = 12.5 million dollars Your Response: TI = AICC/CCP ($2.5 Mil)/(.20)= $12,500,000 2. Calculate inventory turns. Assume COGS represents 50% of revenues. (Show calculation) Points Earned: 2/2 Correct Answer: Inventory Turns = Cost of goods sold/ Total inventory; Cost of goods sold = 50% of 50 million = 25 million; Inventory Turns = 25 million/ 12.5 million = 2 Your Response: IT = COGS/Inventory =(.50*Revenue)/(Inventory) =(.50*$50 mil)/($12.5 mil) = 2 3. Explain the meaning of the inventory turns number calculated in the above question, and also explain if the turns number is good or bad and why. Further exemplifying the fact that this is a poor number is that 2 inventory turns is below the industry average of 6.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 10/10/2010 for the course SCM 460 taught by Professor Dewolf,frankwill during the Spring '10 term at Penn State.

Page1 / 2

Quiz_ Abbey case quiz - uiz Abbey case quiz

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online