Table 2.3 Table 2.

4
Patient Number Arrival Time Departure Time Flow Time
1 7:35 8:50 1:15 Kmart Corp.
2 7:45 10:05 2:20 Inventory
3 8:10 10:10 2:00 Income
4 9:30 11:15 1:45 Total operating revenue
5 10:15 10:30 0:15 Cost of goods sold
6 10:30 13:35 3:05 Net income
7 11:05 13:15 2:10
8 12:35 15:05 2:30 Wal-Mart Stores Inc.
9 14:30 18:10 3:40 Inventory
10 14:35 15:45 1:10 Income
11 14:40 17:20 2:40 Net sales
Average 2:04:32 Total operating revenue
Cost of goods sold
Page 2-10 0.933333333 56 Net income
Page 2-13 15
Kmart 2002 Flow Rate
Kmart 1998 Flow Rate
Wal-Mart 2002 Flow Rate
1/28/1998 1/27/1999 1/26/2000 1/31/2001 1/29/2002

6367 6536 6350 5796 4825

33674 35925 37028 36151 30762

26319 28161 29732 29853 26258
518 364 -268 -2446 -3219

16497 17076 19793 21644 22749

117958 137634 165013 191329 217799

119299 139208 166809 193295 219812
93438 108725 129664 150255 171562
3526 4430 5377 6295 6671

0.1837535 67.070036 5.4420725 3.6750705

0.2419165 88.299517
0.1325993 48.398742 7.5415183
Inventory 400
Cost of Goods Sold 26442
Flow Time (in years) 0.015127
Inventory Turnover 66.105
Per-Unit Inventory Cost Percentage 0.605098
Throughput (in passengers per hour) 255
Inventory 35
Flow Time (in hours) 0.137255
Flow Time (in minutes) 8.235294
Sales 60000000
Inventory 20000000

Part A
Selling Price 2000
COGS per Unit 1000
Units Sold 30000
Total COGS 30000000
Flow Time (in years) 0.666667
Inventory Turns 1.5

Part B
Per-Unit Inventory Cost Percentage 16.66667
Per-Unit Inventory Cost (in $) 166.6667
Revenue 100000000
Inventory 5000000
COGS 50000000

Part A
Flow Time (in years) 0.1
Inventory Turnover 10

Part B
Per-Unit Inventory Cost Percentage 4
Per-Unit Inventory Cost (in $) 1.2
Inventory 1200
Flow Time (in days) 10

Part A
Throughput (in skiers per day) 120

Part B
New Throughput 240
On an average day, there are 1200 skiers, and 240 of those are spending their first night in the hotel.
In 2002/03 there were still an average of 1200 skiers each day, but only 120 of those were spending their first night in the hot

Average Daily Revenue (2002/03) 38400

Average Daily Revenue (2003/04) 40800
Percentage Change from 2002/03 to 2003/04 5.88%
nding their first night in the hotel.
Speed (in MPH) 60
Inventory 24
Flow time for 1/4-mile stretch of highway (in hrs) 0.004167
Throughput (in cars per hour on highway) 5760
Throughput (in cars per minute on highway) 96
Flow Time (in minutes) 12
Flow Time (in hours) 0.2
Throughput (in units per hour) 4000

Required Inventory (oven size) 800

Associates 200
Managers 60
Partners 20

Associate flow time (in years) 4

Manager flow time (in years) 10
Partner flow time (in years) 20

Part A
Associate throughput 50

Part B
Probability that new associate will become partner 0.1
Odds that new associate will become partner 10 to 1
 Costco Wal-Mart
Inventories ($MM) 3643 29447
Sales (net $MM) 48106 286103
COGS ($MM) 41651 215493

Part A
Flow Time (in days) 31.92468 49.87705

Part B
Per-Unit Inventory Cost Percentage 2.623947 4.099484
Per-Unit Inventory Cost (in $) 0.131197 0.204974

Difference between inventory cost for $5 COGS item for the two companies: 0.073777
 McDonald's Wendy's
Inventory 129.4 54.4
Revenue 17140.5 3148.9
Cost of Goods Sold 11943.7 1634.6
Gross Profit 5196.8 1514.4

Part A
Flow Time (in years) 0.01083416 0.03328
Inventory Turnover 92.3006182 30.04779

Part B
Per-Unit Inventory Cost Percentage 0.32502491 0.998409
Per-Unit Inventory Cost (in $) 0.00975075 0.029952

Difference between Wendy's and McDonald's inventory cost per value meal (in $): 0.020202