Materials (DM) + Direct Labor (DL) + Manufacturing Overhead (MO) Manufacturing Costs (MC)/Product Costs (PC)/ Inventoriable Costs (IC) DM + DL Prime Cost DL + MO Conversion Cost Basic Equation for Inventory Accounts Beginning Bal + Additions to Inventory = Ending Bal + W/drawals from Inventory Cost of Goods Sold (COGS) in a Merchandising Co. Beg. Inv + Purchases = Ending I + COGS COGS = Beg. Inv + Purchases – Ending Inv Cost of Goods Sold (COGS) in a Mftg. Co. Beg. FG Inv + COGM = Ending
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divided by sales. If these ratios are large the company has the ability to liquidate and satisfy is obligations. Activity ratios like inventory turnover, accounts receivable, turnover, total asset turnover, and fixed asset turnover measures how assets are used. Inventory turnover is how inventory is created and used which is the ratio of cost of goods sold to inventory. Accounts receivable turnover indicates how often in a period credit sales have been collected on. Total asset turnover ratio is the
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Strategic Operation Issues Executive Summary This paper reviews a core process of the Light and Power organisation with a view to seeking opportunity for change in the performance of process against the organisation’s strategic objectives. The organisation is currently not performing to target and improvement is required. By examining the design of a core process of the business and mapping process flow the impact of current design and capacity on outputs is able to be quantified and possible gains
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Earnings72 000 At acquisition date, all the identifiable assets and liabilities of Napoli Ltd were recorded at amounts equal to fair value except for: CarryingFair AmountValue Land$50 000$75 000 Buildings (cost $75 000)55 00057 000 Inventory45 00060 000 Plant (cost $260 000)182 000190 000 Delivery Truck (cost $90 000)36 00038 000 Any adjustments for differences between carrying amounts at acquisition date and fair values are made on consolidation. Any valuation reserves
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VF Brand: Global Supply Chain Strategy ABSTRACT: This case examines VF Brands global supply chain strategy. Historically, VF has used a combination of in-house manufacturing and traditional arms-length sourcing arrangements. At the time of the case, the company is considering a third approach to supplier relations that involves much closer cooperation and partnerships. The goal of this "third way" approach is to create a sourcing relationship that combines some of the virtues of vertical integration
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recognizable brand name and strong image. However, their traditional business practices are becoming increasingly inefficient and costly. Operating within a environment of large scale demand variations which have grossly inflated manufacturing, inventory, and transportation costs Giorgio Maggiali, director of Barilla's logistics department is proposing an innovative idea created by his predecessor Brando Vitali called Just-in-Time Distribution (JITD). This is a significant change from their traditional
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Stock control and inventory Stock control is used to show how much stock you have at a point in time, and how you keep track of it. It applies to every item you use to produce from raw materials to finished goods and whether it is a product or service. It covers stock at each stage of the production process, from purchase and delivery to using and re-ordering the stock. Having the right amount of stock is important as it ensures that capital is not tied up unnecessarily, and protects
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distribution network including independent third party distributors and due to such a multi-echlon network, Barilla has been experiencing large amounts of variability in demand which are resulting in operational inefficiency and increased manufacturing, inventory and distribution costs. The proposed JITD system required the distributors to share their sales data with Barilla, who would then forecast and deliver appropriate amounts of products to the distributors at the right time in order to effectively
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transaction. Classical inventory theory usually assumes that the inventory on record is accurate and thus reflects the actual inventory level. However, in practice the inventory on record is not always accurate. The exact inventory level is not known to managers, and can deviate from the actual inventory level. There are many possible reasons for such discrepancies between the inventory on record and the actual inventory level, including transaction errors, misplaced inventory, spoilage, defective
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Merloni Elettrodomestici SpA – Transit Point Experiment Case Study Introduction |Merloni Elettrodomestici SPA (Merloni) is a major Italian manufacturer of high quality domestic appliances –of the | |‘free-standing’ and ‘built-in’ varieties, both in Italy and throughout Europe. Founded in the year 1975 as Merloni | |Elettrodomestici SpA by Vittorio Merloni, as a spin-off from Industrie Merloni. It was renamed Indesit Company S.p.A in | |2005 after a company it acquired
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