Exercise 1

1)
Inventury turns

Audio Visual:
Inventury turns=

Accessories
Inventury turns=

For all products:

Inventury turns=

2)
Per Unit Cost
Annual Inv Cost
Audio/Video

=1/Flow time
=Rate/Av. Inv
=COGS/Av. Inv

=36231000/(15250*200)
11.88 turns/year

=9776000/(54000*50)
3.62 turns/year

(36231000+9776000)/(15250*200+54000*50)
8.00 turns/year

=(Annual Inv Cost )/(Annual Inv Turns)

30%
=30%/(11.88)
2.53%

Accessories =30%/(3.62)
8.29%

3)
Accessories per unit cost=8.28%
=Pacc*COGS/sales
Absolute turns
=50*9776000/13100000
37.31298
4)

if dual owned them then total avg inv=( 54000+5400)*50=2970000

turnover of accessories 976000/2970000=3.29 turns
per unit cost=30%/3.29=9.114 %/unit= 4.55$/50 50$/unit

5) Safety Inv:
Cycle