9.15 If the annual cost of goods sold is $30,000,000 and the average inventory is $5,000,000: a. What is the inventory turns ratio? b. What would be the reduction in average inventory if, through better materials management, inventory turns were increased to 10 times per year? c. If the cost of carrying inventory is 25% of the average inventory, what is the annual savings?
9.15 If the annual cost of goods sold is $30,000,000 and the average inventory is $5,000,000: a. What is the inventory turns ratio? b. What would be the reduction in average inventory if, through better materials management, inventory turns were increased to 10 times per year? c. If the cost of carrying inventory is 25% of the average inventory, what is the annual savings?
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
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Question
![9.15
If the annual cost of goods sold is $30,000,000 and the average inventory is $5,000,000:
a. What is the inventory turns ratio?
b. What would be the reduction in average inventory if, through better materials
management, inventory turns were increased to 10 times per year?
c. If the cost of carrying inventory is 25% of the average inventory, what is the annual
savings?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5a99bae1-6366-4edc-b05f-bae669e813bc%2Fd0674556-7d8e-4fb4-a36d-328c77b29f60%2Fs1u89y8_processed.png&w=3840&q=75)
Transcribed Image Text:9.15
If the annual cost of goods sold is $30,000,000 and the average inventory is $5,000,000:
a. What is the inventory turns ratio?
b. What would be the reduction in average inventory if, through better materials
management, inventory turns were increased to 10 times per year?
c. If the cost of carrying inventory is 25% of the average inventory, what is the annual
savings?
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