The company believes that it might have some inefficiency in its inventory management process. Develop an ABC classification system for the following 10 items. Based on this information, what do you recommend for improving inventory management?

Item	Annual Demand	Cost/Unit
I5	1750	10.00
D1	6000	10.00
A2	3000	50.00
E9	1000	20.00
J8	2500	5.00
C7	1500	45.00
B8	4000	12.00
G2	300	1500.00
H2	600	20.00
F3	500	500.00

Exemplary (100%)	Proficient (85%)	Needs Improvement (55%)	Not Evident (0%)
Meets Proficient criteria and justifies improvements with logical reasoning or support from outside sources	Correctly develops an ABC classification system and recommends improvements in inventory management	Correctly develops an ABC classification system but does not recommend improvements in inventory management	Does not correctly develop an ABC classification system

Tip: You only need to use total annual cost to determine ABC classification.