company's Controller: who expressed that the company had way too much purchased material inventory and was negatively impacting the company's cash flow. The Supply Manager requested the Purchasing & Materials group to review the 3 highest dollar purchased items and verify their purchasing and inventory practices and if their safety stocks were properly set. Demand for these materials had been reasonably "stable" and was anticipated to continue that way. Purchasing placed orders for materials and components to suppliers to cover requirements on a weekly basis and the company operates in a 5-day week schedule. The Supply Manager's staff presented the following information High Runner Purchased Parts Price per Unit $ 500 USD $ 25 USD $ 1800 USD Daily Requirements 3500 pcs 24000 pcs 1000 pcs Current Planned Safety Stock in Pcs 1000 pcs 60,000 pcs 1,000 pcs Current On Hand Inventory in 1000 pcs 90,000 pcs 3000 pcs Providing Vendor Delivery 85% of Orders 98% of Orders 90% of Orders Performance On-Time On-Time On-Time Average Vendor Order Recovery when late in Days Pcs 1 Vendor Lead Time 10 working days 1 working days 5 working days > Question No. 5.- If you concluded to suggest new buffer stock levels would these changes improve the company's cash flow position ? If so, by how much ? Difference in Cash Position =