Study: Delivery Strategy at MoonChem Annual cost of existing strategy Considering different delivery options Impact of the proposed recommendation on consignment inventory Chapter 11 Case Study: Managing Inventories at Alko Inc. Annual costs Savings associated with NDC and recommendations Recommendation and evaluation of other distribution systems Chapter 10 Case Study: Delivery Strategy at MoonChem MoonChem is a manufacturer
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Solution pour l’étude de cas “MoonChem” 1. What is the annual cost of MoonChem’s strategy of sending full truckloads to each customer in the Peoria region to replenish consignment inventory? MoonChem’s customer profile appears in Table 10-4 and is reproduced below: Customer Type Number of Consumption Customers (Pounds per Month) Small Medium Large 12 6 2 1‚000 5‚000 12‚000 Each truck has a fixed capacity of 40‚000 pounds and costs MoonChem $400 per delivery. The Small customers use only 12‚000 pounds
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One of the SKUs has the following characteristics. Demand (D) = 20‚000 units/year Ordering cost (S) = $40/order Holding cost (H) = $2/unit/year Lead time (L) = 2weeks Cycle-service level = 95% Demand is normally distributed with a standard deviation of weekly demand of 100 units. Current on-hand inventory is 1.040 units with no scheduled receipts and no backorders. 1. Calculate the item’s EOQ. What is the average time‚ in weeks between orders? EOQ = (2DS)/H EOQ = (2*20000*40)/2 EOQ = 800000
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Inventory management has two very different‚ but effective methods: Vendor managed inventory‚ and consignment inventory. A company may choose to utilize either of these two methods to manage inventory. If a company is able to manage inventory‚ they will be better able to work the company’s capital to the fullest extent. The following paper will identify the differences between the two as well as identify what type of company is best suited for each method. Definition. Vendor managed inventory (VMI)
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Meaning of Consignment: In an ever growing market for almost every product‚ it is becoming very difficult for the manufacturer or the wholeseller toestablish a direct link with the ultimate consumers of his products because of largedistance‚ high cost of marketing through own selling outlets (e.g.‚ branches) andignorance of local conditions. Under these circumstances consignment is a popular way of creating new markets for a product and distributing goods in national andinternational markets. This
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Analysis The annual maintenance coast of machine shop is P 69‚994. If the cost of making a forging is P 56 per unit and its selling price is P 135 per forged unit‚ find the number of unit to be forged to break-even. Solution: Let: x = number of units to be forged to break-even Income = 135x Expenses = 69‚994 + 56x To break-even: Income = Expenses 135x = 69‚994 + 56x 79x =69‚994 x = 886 units Steel drum manufacturer incurs a yearly fixed operating cost of $ 200
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MCQS | EACH QUESTIONS HAS FOUR POSSIBLE ANSWERS CHOOSE THE CORRECT ANSWER: | (1) | In accounting consignment means. | | (a) Goods forwarded from one place to another.(b) Goods forwarded by a person to another. (c) Goods sent by its owner to his agent. (d) Goods sent by its owner to his agent for the purpose by sale. (T) | (2) | Goods sent on consignment should be debited by consignor to: | | (a) Consignment A/c (T)(b) Goods sent on
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Any two should be completed and submitted individually. MGM 713 C A S E 2 ASSIGNMENT QUESTIONS 1. What is Costco’s business model? Is the company’s business model appealing? Why or why not? 2. What are the chief elements of Costco’s strategy? How good is the strategy? 3. Do you think Jim Sinegal is an effective CEO? What grades would you give him in leading the process of crafting and executing Costco’s strategy? What support can you offer for these grades? Refer to Figure 2.1 in Chapter
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patented process at acost of more than $60 per barrel. The barrels could not be reused foraging future batches of bourbon whiskey but could be sold to used barrel dealers for $1 each at the end of the aging period. * The increased production in 1988 necessitated the leasing of an additional warehouse at an annual rental cost of $200‚000. The temperature and humidity of the warehouse space had to be controlled since the quality of the whiskey could be ruined by its aging too fast or too slowly.
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Case Study Inventory The Cost of Inventory The general principle for cost inclusion into inventory for US GAAP and IFRS is similar but not exactly the same. First let us look at US GAAP. The basis of accounting for inventories is “cost‚” which is explained in ASC 330-10-30 paragraph 1 as “the sum of the applicable expenditures and charges directly or indirectly incurred in bringing an article to its existing condition and location.” These costs are divided into two different categories‚ the
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