Boreki Enterprise has the following 10 items in inventory. Theodore Boreki asks

Question

Boreki Enterprise has the following 10 items in inventory. Theodore Boreki asks you, a recent OM graduate, to divide these items into ABC classifications. Fill in the blanks and then answer the following questions. (Round dollar volume to the nearest whole number and percentage of dollar volume to two decimal places.) Dollar % of Total Dollar Volume Item Annual Demand Cost/Unit Volume A2 B8 C7 D1 E9 F3 G2 H2 I5 J8 500 4000 1500 20 1000 34 200 600 1000 2500 300 12 45 35 20 250 1500 20 65 7.02 9.87 48,000 67,500 20,000 300,000 2.92 43.85 1.75 12,000 12,500 1.83

Explanation / Answer

The formula to calculate dollar volume is :

Annual demand x cost per unit

So using the above formula the dollar volume for the following items are

The formula to calculate the the percentage of total dollar volume = (Dollar volume / Total dollar volume) 100

Total dollar volume = Sum of the dollar volume for each item = 684200

So percentage of dollar volume for the following items are

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