PRODUCT # ANNUAL UNITS SOLD SALE PRICE PER UNIT SR101 15,000 $250 SR103 750 $1,500 SR105 1,600 $600 SR201 45 $2,250 SR203 10 $3,500 SR205 9,250 $500 SR301 700 $650 SR303 550 $700 SR305 3,000 $920 SR500 100 $1,100 Mark Question Assignment 3 1 Build an ABC Analysis based on Annual Volume (Units Sold). 3 2 Build an ABC Analysis based on Annual Gross Revenue ($). 1 3 Do the two Analyses result in the same ABC groupings? 3 4 Which of the two Analyses more closely follows the Pareto principal? Explain your answer. 10 Answer on this document / use additional tabs if necessary.

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To answer the questions and complete the assignment, let's first calculate the annual gross revenue for each product by multiplying the annual units sold by the sale price per unit.

Annual Gross Revenue = Annual Units Sold * Sale Price per Unit

Here are the calculations for each product:

PRODUCT # SR101: 15,000 * $250 = $3,750,000 PRODUCT # SR103: 750 * $1,500 = $1,125,000 PRODUCT # SR105: 1,600 * $600 = $960,000 PRODUCT # SR201: 45 * $2,250 = $101,250 PRODUCT # SR203: 10 * $3,500 = $35,000 PRODUCT # SR205: 9,250 * $500 = $4,625,000 PRODUCT # SR301: 700 * $650 = $455,000 PRODUCT # SR303: 550 * $700 = $385,000 PRODUCT # SR305: 3,000 * $920 = $2,760,000 PRODUCT # SR500: 100 * $1,100 = $110,000

Now let's proceed with the analysis.

1. Build an ABC Analysis based on Annual Volume (Units Sold):

To perform the ABC Analysis based on annual volume, we will categorize the products into three groups: A, B, and C. Group A will consist of the top 20% of products with the highest annual units sold, group B will be the next 30%, and group C will be the remaining 50%.

Total Annual Units Sold = Sum of Annual Units Sold for all products

Total Annual Units Sold = 15,000 + 750 + 1,600 + 45 + 10 + 9,250 + 700 + 550 + 3,000 + 100 = 30,005

20% of Total Annual Units Sold = 0.2 * 30,005 = 6,001

30% of Total Annual Units Sold = 0.3 * 30,005 = 9,001

The ABC Analysis based on Annual Volume is as follows:

Group A: Products with the highest annual units sold

• SR101: 15,000 units

Group B: Products with moderate annual units sold

• SR205: 9,250 units
• SR105: 1,600 units
• SR305: 3,000 units
• SR301: 700 units
• SR303: 550 units
• SR103: 750 units

Group C: Products with the lowest annual units sold

• SR500: 100 units
• SR201: 45 units
• SR203: 10 units

1. Mark Question Assignment 3
2. Build an ABC Analysis based on Annual Volume (Units Sold).
3. Build an ABC Analysis based on Annual Gross Revenue ($).
4. Do the two Analyses result in the same ABC groupings?
5. Which of the two Analyses more closely follows the Pareto principal? Explain your answer
6. Answer on this document / use additional tabs if necessary.