Your Company Has Compiled the Following Data on the Small

question 159

Essay

Your company has compiled the following data on the small set of products that comprise the specialty repair parts division. Perform ABC analysis on the data. Which products do you suggest the firm keep the tightest control over? Explain.
$$\begin{array} { | c | c | c | } \hline \text { SKU } & \text { Annual Demand } & \text { Unit Cost } \\\hline \text { R11 } & 250 & \$ 250 \\\hline \text { S22 } & 75 & \$ 90 \\\hline \text { T33 } & 20 & \$ 60 \\\hline \text { U44 } & 150 & \$ 150 \\\hline \text { V55 } & 100 & \$ 75 \\\hline\end{array}$$

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Definitions:

Qualification Purposes

The specific reasons or objectives for requiring or seeking a particular certification, status, or level of skill.

Stock of Goods

The inventory of products or goods that a company has on hand to sell to customers.

Independent Distributors

Businesses or individuals that distribute products or services, but are not directly employed by the manufacturers of those products, allowing for operational and financial autonomy.

Internal Affairs

A doctrine in corporate law that allows the internal affairs of a corporation, such as shareholder rights, to be governed by the laws of the state of incorporation.