The U.S. Airfilter company has hired you as a supply chain consultant. The company makes air filters for residential heating and air-conditioning systems. These filters are made in a single plant located in Louisville, Kentucky, in the United States. They are distributed to retailers through wholesale centers in 100 locations in the United States, Canada, and Europe. You have collected the following data relating to the value of inventory in the U.S. Airfilter supply chain: QUARTER 4 (ОСТОВER THROUGH QUARTER 3 (JULY THROUGH SEPTEMBER) All amounts in millions of U.S. dollars QUARTER 1 (JANUARY THROUGH MARCH) QUARTER 2 (APRIL THROUGH JUNE) DECEMBER) Sales (total quarter): United states 375 70 15 300 350 60 405 75 Canada 75 Europe 30 33 20 Cost of goods sold (total quarter) 280 295 340 350 Raw materials at the Louisville plant (end-of-quarter) 50 40 55 60 Work-in-process and finished goods at the Louisville plant (end-of-quarter) 100 105 120 150 Distribution center inventory (end-of-quarter): United states 25 27 23 30 Canada 10 11 15 16 5 Europe 5 5 a. What is the average inventory turnover for the firm? (Round your answer to 3 decimal places.) Average inventory turnover b. If you were given the assignment to increase inventory turnover, what would you focus on? O Increase the amount of inventory or increase sales or both O Reduce the amount of inventory or increase sales or both O Reduce the amount of inventory or reduce sales or both c. The company reported that it used $500M worth of raw material during the year. On average, how many weeks of supply of raw material are on hand at the factory? (Round your answer to 2 decimal places.) Weeks of raw material supply
The U.S. Airfilter company has hired you as a supply chain consultant. The company makes air filters for residential heating and air-conditioning systems. These filters are made in a single plant located in Louisville, Kentucky, in the United States. They are distributed to retailers through wholesale centers in 100 locations in the United States, Canada, and Europe. You have collected the following data relating to the value of inventory in the U.S. Airfilter supply chain: QUARTER 4 (ОСТОВER THROUGH QUARTER 3 (JULY THROUGH SEPTEMBER) All amounts in millions of U.S. dollars QUARTER 1 (JANUARY THROUGH MARCH) QUARTER 2 (APRIL THROUGH JUNE) DECEMBER) Sales (total quarter): United states 375 70 15 300 350 60 405 75 Canada 75 Europe 30 33 20 Cost of goods sold (total quarter) 280 295 340 350 Raw materials at the Louisville plant (end-of-quarter) 50 40 55 60 Work-in-process and finished goods at the Louisville plant (end-of-quarter) 100 105 120 150 Distribution center inventory (end-of-quarter): United states 25 27 23 30 Canada 10 11 15 16 5 Europe 5 5 a. What is the average inventory turnover for the firm? (Round your answer to 3 decimal places.) Average inventory turnover b. If you were given the assignment to increase inventory turnover, what would you focus on? O Increase the amount of inventory or increase sales or both O Reduce the amount of inventory or increase sales or both O Reduce the amount of inventory or reduce sales or both c. The company reported that it used $500M worth of raw material during the year. On average, how many weeks of supply of raw material are on hand at the factory? (Round your answer to 2 decimal places.) Weeks of raw material supply
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Transcribed Image Text:The U.S. Airfilter company has hired you as a supply chain consultant. The company makes air filters for residential heating and air-conditioning systems. These filters are made in a single plant located in
Louisville, Kentucky, in the United States. They are distributed to retailers through wholesale centers in 100 locations in the United States, Canada, and Europe. You have collected the following data relating to
the value of inventory in the U.S. Airfilter supply chain:
QUARTER 4
(ОСТОВER
THROUGH
QUARTER 3
(JULY
THROUGH
SEPTEMBER)
All amounts in millions of U.S. dollars
QUARTER 1
(JANUARY
THROUGH
MARCH)
QUARTER 2
(APRIL THROUGH
JUNE)
DECEMBER)
Sales (total quarter):
United states
375
70
15
300
350
60
405
75
Canada
75
Europe
30
33
20
Cost of goods sold (total quarter)
280
295
340
350
Raw materials at the Louisville plant
(end-of-quarter)
50
40
55
60
Work-in-process and finished goods at the Louisville plant
(end-of-quarter)
100
105
120
150
Distribution center inventory
(end-of-quarter):
United states
25
27
23
30
Canada
10
11
15
16
5
Europe
5
5
a. What is the average inventory turnover for the firm? (Round your answer to 3 decimal places.)
Average inventory turnover
Transcribed Image Text:b. If you were given the assignment to increase inventory turnover, what would you focus on?
O Increase the amount of inventory or increase sales or both
O Reduce the amount of inventory or increase sales or both
O Reduce the amount of inventory or reduce sales or both
c. The company reported that it used $500M worth of raw material during the year. On average, how many weeks of supply of raw material are on hand at the factory? (Round your answer to 2 decimal
places.)
Weeks of raw material supply
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