sales = 100,000 units Cost to place an order = $25 Freight cost = $225 Cost of 1 unit of inventory $100 Cost of Goods Sold $10,000,000 Selling price of 1 unit = $200 Storage cost = $33 per year Lead-time is 6 days Average inventory $250,000 Re-stock fee is $45 Cost of capital = 25% Storage space = 5% Insurance = .5% Prime interest rate = 3.6% %3D !! Taxes = 1.5% Average annual depreciation = 15% Service cost = 2% Risk = 1% %3D Forecast error = 13% - List the components of inventory carrying cost and calculate the ICC%.

sales = 100,000 units Cost to place an order = $25 Freight cost = $225 Cost of 1 unit of inventory $100 Cost of Goods Sold $10,000,000 Selling price of 1 unit = $200 Storage cost = $33 per year Lead-time is 6 days Average inventory $250,000 Re-stock fee is $45 Cost of capital = 25% Storage space = 5% Insurance = .5% Prime interest rate = 3.6% %3D !! Taxes = 1.5% Average annual depreciation = 15% Service cost = 2% Risk = 1% %3D Forecast error = 13% - List the components of inventory carrying cost and calculate the ICC%.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 11P: Negus Enterprises has an inventory conversion period of 50 days, an average collection period of 35...

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