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with a total dollar usage of $10,000,000 per year. a. What would you expect to be the number of SKUs and the total annual dollar usage for A items, B items, and C items at Southern Markets, Inc.? b. The following table provides a random sample of the unit values and annual demands of eight SKUs. Categorize these SKUs as A, B, and C items.

with a total dollar usage of $10,000,000 per year. a. What would you expect to be the number of SKUs and the total annual dollar usage for A items, B items, and C items at Southern Markets, Inc.? b. The following table provides a random sample of the unit values and annual demands of eight SKUs. Categorize these SKUs as A, B, and C items.

Practical Management Science
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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Southern Markets, Inc. is considering the use of ABC
analysis to focus on the most critical SKUs in its inventory.
Currently, there are approximately 20,000 different SKUs
with a total dollar usage of $10,000,000 per year.
a. What would you expect to be the number of SKUs and the
total annual dollar usage for A items, B items, and C items
at Southern Markets, Inc.?

b. The following table provides a random sample of the unit
values and annual demands of eight SKUs. Categorize
these SKUs as A, B, and C items.

SKU Code Unit Value Demand (Units) A104 $0.85 370 D205 $0.03 3,500 X104 $4.35 60 U404 $2.20 2,700 L205 $4.70 25 S104 $2.40 30 X205 $0.23 270 L104 $0.36 1,040
Transcribed Image Text:SKU Code Unit Value Demand (Units) A104 $0.85 370 D205 $0.03 3,500 X104 $4.35 60 U404 $2.20 2,700 L205 $4.70 25 S104 $2.40 30 X205 $0.23 270 L104 $0.36 1,040
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