CASE STUDY 3 MANG update.doc - Inventory Management u2013...

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Inventory Management – Wagner Fabricating Company Case Study 3 Ashley Cooley 10/01/19
Summary: Forecasted annual demand for the part is 3,200 units. Wagner operates 250 days a year. Wagner’s financial analysis established a cost of Capital of 14% for the use of funds for investments within the company. the company has a contract to purchase the part from a supplier at a cost of $18 per unit. However, over the past few months, the company’s production capacity has been expanded . Managerial Report Develop a report for management of Wagner Fabricating that will address the question of whether the company should continue to purchase the part from the supplier or being to produce the part itself. Include the following factors in your report:

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