• Amazon applies Lean accounting principles to its supply chain.
• Requirements:
  • Calculate the Total Cost of Ownership (TCO) for Amazon's fulfillment centers, where initial costs were $50,000,000, annual maintenance costs are $2,000,000, and the lifespan is projected to be 20 years.
  • Recommend strategies to minimize TCO.
  • Explain the importance of managing TCO in Lean supply chain practices at Amazon.
  • Present a table showing the breakdown of TCO components and potential savings.

Metric	Calculation	Value
Total Cost of Ownership (TCO)	Initial Costs + (Annual Maintenance × Lifespan)	$50,000,000 + ($2,000,000 × 20 years)
Target TCO Reduction	Reduced Initial Costs + (Reduced Maintenance × Same Lifespan)	$X
Financial Impact	Cost savings and improved profitability	$Y
Impact on Balance Sheet	Improved asset management and liquidity	$Z