Exam practice questions. Show work step by step

User Generated

oyvmm003

Business Finance

Description

I need help with the attached business questions. There are 13 questions in total. The final solution is listed on the last page. I need step by step work to be shown for the questions, (explanation of how to obtain the answers) so I can solve similar questions by myself.

Please do not bid if you're not confident that you can solve and show work for all.

Unformatted Attachment Preview

V 014, 3:21 AM < Exam 3 Prep Gui... Exam 3 Practice Exercises To check your answers go to the last page of this guide. If you are having trouble with any exercises go to the weekly learning module and review videos for practice exercises. Managing Inventory 10-1 Measuring Inventory Performance Most firms will have various measures of inventory management performance. Inventory turns are how many times per year our inventory “turns” or is consumed. An alternative measure is days on hand which represents the number of days our inventory will provision production. Both are average values and they tell the same story. How much inventory are we holding in relationship to demand. Inventory Turnover cost of goods sold Inventory turnover = average value of inventory Inventory Time-Supply Weeks of Supply = (Avg Value of Inventory/COGS) x 52 wks/yr = (1/Inventory Turns) x 52 Days of Supply =(Avg Value of Inventory/COGS) x 365 days/yr = (1/Inventory Turns) x 365 Inventory turns and On-Hand: Acme company's 2015 annual report shows sales revenue of $476,000,000; cost of goods sold of $358,000,000; $15,700,000 production material on-hand, and $4,500,000 WIP and Finished goods inventory. 1. Calculate the 2015 inventory turns 2. Calculate the 2015 weeks on hand 3. Calculate the 2015 days on hand 10-2. Periodic Review Policy: Ordering to a predetermined restocking level. A periodic review system is used to manage independent demand inventory where the inventory level for an item is checked at regular intervals and restocked to a predetermined level. Q=R-1 where Q is the order quantity; R is the predetermined restocking level; and I is inventory. “The Hound" loves to eat Peanut M&Ms (with skull images), and relies on the sugar and protein nutrition to power him up for battle as circumstances often require. He uses a periodic review system on Monday's to manage the inventory of the single Peanut M&M packs in his possession. He likes to maintain inventory levels at 50 packs of Peanut M&Ms stuffed in his pockets and eats a different 014, 3:22 AM K Exam 3 Prep Gui... Q amount each day depending on the number of battles he fights and how many chickens he can steal. In a year, he will eat about 2,750 M&M packs. It costs him 2 Gold Dragon coins to place an order and 1 Gold Dragon coin to hold a single bag in inventory for the year. The Hound wakes one Monday and finds he only has 5 bags in his pockets. How many bags of Peanut M&Ms should he buy (Q) from Tyrion before leaving for his next adventure? 10-3 Continuous Review EOQ and ROP Continuous Review System - An inventory system used to manage independent demand inventory where the inventory level for an item is constantly monitored and when the reorder point is reached, an order is released. EOQ: The EOQ model uses a fixed order quantity for independent demand and looks at the tradeoff between the marginal ordering cost and carrying cost of inventory. Qopt = |2DS V H = 2(Annual Demand)(Order or Setup Cost) Annual Holding Cost Ollah's Organic Pet Shop sells about 4,000 bags of free-range dog biscuits every year. The fixed ordering cost is $15, and the cost of holding a bag in inventory for a year is $2. Lead time to receive an order of biscuits is 15 days. 1: Calculate EOQ 2: Calculate the reorder point using lead time and demand. ROP=dL ]14, 3:22 AM K < Exam 3 Prep Gui... Q 10-4: Comparing Order Quantity Marginal Costs The Bonnie and Clyde National Bank always orders 25 cases of paper from their office supply company. They incur an annual holding cost of $10 per case and have an ordering cost of $48 each time they place an order. Annual demand for cases of paper is 2000 cases. How much could the bank save annually by switching to their economic order quantity? Managing Production & MRP Handout 11-1: Measuring Inventory Performance Calculating projected ending inventory and Available to promise (ATP) On-hand inventory at end of week 1 Week Forecasted demand Booked orders Projected ending inventory Master production schedule Available to promise 2 45 15 65 3 50 100 4 55 48 5 60 25 6 65 72 7 70 22 В 75 67 9 ВО 10 150 200 150 A. Refer to the above master schedule. Calculate the projected ending inventory for weeks 2 through 9. B. Refer to the above master schedule. Calculate the available promise for the production weeks (2, 5, and 8) 014, 3:22 AM K Exam 3 Prep Gui... Q 11-2. Product Structure and the BOM A product structure tree is simply a graphical representation of the bill of materials (BOM) that shows how all the components of the BOM are associated to make the level O item including quantities of each component. Level 0 items are what we think of as a complete finished part in most cases. A2) A(2) B C(3) D(3) Н. D(2) G(3) H(2) E(4) F(2) K(4) F(2) E(4) F(2) J(2) E(3) K(4) With a beginning inventory of zero for all components and finished items, how many assembly F's are needed to produce 20 product X's? 11-3 Calculating MRP Exercise 11-3 Week: 1 4 5 2 400 100 3 400 6 400 400 LT (weeks) 200 50 Gross requirements 1 Scheduled receipts Projected ending inventory: Net requirements 300 Planned receipts Planned orders Min. order: 1. What is the net requirement in week 3? 2. What is the projected ending inventory in week 6? 3. What are the planned receipts in week 4? What are the planned orders in week 5? 4. 114, 3:22 AM K k Exam 3 Prep Gui... Q ; 13-1 Kanban loop sizing Calculate the kanban loop size based on the following information. You have been called in as a consultant to set up a Kanban control system. The first thing you do is to determine the number of Kanban card sets needed. Your research shows that the expected demand during lead time for a particular component is 1,200 per hour. You estimate the safety stock should be set at 5% of the demand during lead time. The tote trays used as containers can hold 2 units of stock and the lead time to replenish an order is 10 hours. Which of the following is the number of Kanban card sets necessary to support this situation? Solutions: 10-1a: 2015 turns = 17.72 or 18 10-1b: 2015 weeks on hand = 2.93 10-1c: 2015 days on hand = 20.59 10-2: M&M Q = 45 10-3a: EOQ = 244.9 or 245 10-3b: ROP = 164.4 10-4: Adopting EOQ yields savings of $2,579.35 11-1a and b: Projected ending inventory and ATP: On-hand inventory at end of week 1 65 Week 2 3 Forecasted demand 45 50 Booked orders 15 100 Projected ending inventory 170 70 Master production schedule 150 Available to promise 52 11-2: Requirements for Fare 680 11-3: MRP calculations solution Exercise 11-3 Gross requirements LT (weeks): 1 Scheduled receipts Projected ending inventory: Net requirements Min. order: 300 Planned receipts Planned orders 4 55 48 15 5 60 25 155 200 81 6 65 72 83 7 70 22 13 B 75 67 88 150 73 9 BO 10 8 Week: 1 5 3 400 4 400 6 400 200 250 50 2. 400 100 250 50 300 300 150 50 150 50 250 300 350 350 300 300 300 350 125.00 Average inventory over the 6 weeks: 13-1: Kanban loop size is 6,300
Purchase answer to see full attachment
User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

Explanation & Answer

hello, attached is the paper with all the solutions. let me know if you require some more explanations made

Solutions
10.1 measuring inventory turnover
a. 2015 inventory turnover
Inventory turnover = Cost of goods sold / average value of inventory
COGS = 358,000,000 /
Average inventory = 15,700,000 + 4,500,000
= 20,200,000
Inventory turns = 358,000,000 / 20,200,000
= 17.72
b. 2015 weeks on hand
Weeks on hand = (1 / inventory turns) x 52
= 1/17.72 x 52
= 2.93
c. 2015 days on hand
Days on hand = (1 / inventory turns) x 365
= (1/17.72) x 365
= 20.59

10-2 periodic review policy
Safety stock = 50 packs
Annual demand = 2,750
Ordering cost = 2
Holding cost = 1
Stock level = 5
Q = R-I
Where R is the restocking level
I is the inventory level at time of review

Q = 50 – 5
= 45
10-3
a. Calculate EOQ
EOQ = (2FD/C)1/2
Where F is the Fixed Cost Per Order = $15
C is the carrying cost per unit per year = $2
D is the demands in units per year = 4,000 bags
EOQ = ((2 x 15 x 4000) / 2) ½
= (60,000)½
= 245
b. Reorder point
ROP = dl
where d is demand per day = 4000/365
l is the lead time = 15
ROP = 4000/365 x 15
= 164.4
10-4 comparing order quantity marginal costs
Order size = 25 cases
Annual holding cost = $10 /case
Ordering cost per order = $48
Annual demand = 2,000 cases
Orders per year = 2000/25 = 80
Total ordering cost = orders per year x fixed ordering cost
= 80 x 48 = 3840
Total holding cost = Average inventory x...


Anonymous
I was having a hard time with this subject, and this was a great help.

Studypool
4.7
Trustpilot
4.5
Sitejabber
4.4

Related Tags