Coral gables electronics is considering reorganizing

Reference no: EM13283268

Coral Gables Electronics is considering reorganizing its plant into manufacturing cells. The company has the following information:
Before the change After the change
Total annual sales $872,491 $1,036,902
Costs as percentage of sales:
Direct materials 11.09% 9.36%
Direct labor 5.68% 5.41%
Manufacturing support costs 9.12% 8.47%
Work-in-process inventory $305,974 $264,948

Inventory carrying costs are estimated to be 12.39% per year.

As a result of the layout reorganization, what amount of annual change is projected

1. from carrying reduced levels of work-in-process inventory? Answer

2. for incremental manufacturing costs? Answer ___

3. in total benefits? Answer __

Reference no: EM13283268

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