Mylab Operations Management With Pearson Etext -- Access Card -- For Operations Management: Sustainability And Supply Chain Management (13th Edition)
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Chapter 1, Problem 1.3VC
Summary Introduction

Case summary:

FL Company produces potato chips. The firm has 38 plants around the U Country and over 48,000 employees are working for the firm. The company focuses more on the firm operations, from product designing, meeting changing consumer preferences, adjusting changing consumers’ costs, supply chain management, and quality and maintenance.

FL Company quality inspection begins at the farm in procuring potatoes and continues with the inspection until the final product is packed and dispatched to the market. FL Company would make sure that they have a proper product mix, effective maintenance and quality inspection has to be done.

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  • Company FL

To determine: How the operation management decisions for service companies such as HR Cafe differ from FL Company’s operations decision.

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2. The Ashton Furniture Company manufactures coffee tables and chest of drawers. Last year the company's cost of goods sold was $3,700,000, and it carried inventory of oak, pine, stains, joiners, and brass fixtures, work-in-process of furniture frames, drawers and wood panels, and finished chests and coffee tables. Its average inventory levels for a 52-week* business year were as follows. Raw Materials Oak Pine Brass fixtures Stains Joiners Work-in-Process Frames Drawers Panels Chests Tables Finished Goods Chests Coffee tables *1 week = 7 days Average Inventory 8000 4500 1200 3000 900 200 400 600 120 90 300 200 Unit Cost $6 4 8 2 1 $30 10 50 110 90 $500 350 Formula: Inventory turns = Cost of goods sold / Average aggregate value of inventory Days of supply = Average aggregate value of inventory / (Cost of goods sold / total days) Question: Determine the number of inventory turns and the days of supply for the furniture company.
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