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Using the provided inventory data (see below), conduct an ABC analysis and answer the following questions: What percentage of total inventory value is represented by
Using the provided inventory data (see below), conduct an ABC analysis and answer the following questions:
- What percentage of total inventory value is represented by the A, B, and C categories?
- Which items should be classified as A, B, and C based on the ABC analysis? What are the respective inventory values and percentages for each category?
- Based on the ABC analysis, what recommendations would you make to the company regarding inventory management and control?
Inventory Data:
| Item Number | Description | Quantity on Hand | Unit Cost |
|---|---|---|---|
| 1001 | Resistor | 5,000 | $0.10 |
| 1002 | Capacitor | 2,500 | $0.20 |
| 1003 | Diode | 1,000 | $0.30 |
| 1004 | Transistor | 750 | $0.40 |
| 1005 | Integrated Circuit | 500 | $0.50 |
| 1006 | Connector | 250 | $0.60 |
| 1007 | Battery | 100 | $1.00 |
| 1008 | LED | 50 | $1.50 |
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Strategic Management Concepts
Authors: Frank Rothaermel
2nd edition
77645065, 1259384071, 9780077645069, 978-1259384073
