GMS 401 Study Guide - Purch Group, Inventory Turnover, Interval Order

• School: Ryerson University
• Department: Global Management Studies
• Course: GMS 401
• Professor: Carmen Schifellite

Document Summary

Inventory - idle material/product in warehouse kept for use/sale in future relate to kind of bus/ 30% of ca, 90% working capital invested in inv return on investment (roi) = profit after tax total assets. 2. level of customer service (availability) - right goods, sufficient quantities, right cost of ordering and holding inv obj: achieve satisf level of customer service (availability) while keeping inv cost w/in reasonable bound. Lo 2: requirements for effective inventory management: safely storing and using inv. Warehouse uncluttered cramped excessive damage to stock. # of batches per yr = d/q annual setup cost = (d/q)(s) Tc = annual holding cost + annual setup cost = (imax/2)(h) + (d/q)(s) Tc = annual holding cost + annual ordering cost + annual purchase cost. 5)each order re/ in single delivery: no quantity discounts inclu assumption transportation cost per unit fixed and not depend on order size.