What else does this flow time analysis problem demonstrate

Assignment Help Operation Management

Reference no: EM131730951

A manufacturer of air conditioner compressors is concerned that too much money is tied up in its value chain. Average raw material inventory is $50 million and work-in-process (WIP) production inventory is $20 million. Sales are $20 million per week and finished goods inventory averages $30 million. The average outstanding accounts receivable is $60 million. Assume 50 weeks in one year. The value chain is shown below:

Raw Materials Inventory--->Production (WIP) Inventory---> Finished Goods---->Accounts Recievables

a. What is the target level of average accounts receivable inventory if management can reduce the time a dollar spends in accounts receivable inventory (processing and collections) by one-half by improving the accounts receivable process?

b. What else does this flow time analysis problem demonstrate?

Reference no: EM131730951

Questions Cloud

How does the definition of theoretical differ from everyday : How does the definition of "theoretical" differ from everyday thinking and the scientific definition?

Beijing eaps consulting case study-business presentation : Beijing EAPS Consulting Inc.” case study and have witnessed the challenge and rewards of a projectized organizational structure

Expecting the price of a popular brand of canned soup : Expecting the price of a popular brand of canned soup to increase in the future, a supermarket orders extra cases of the soup.

Definitions for data-information and knowledge : Frequently there is mixed, circular use of the terms and definitions for "data", "information" and "knowledge".

What else does this flow time analysis problem demonstrate : What else does this flow time analysis problem demonstrate?

Successfully completed the integrative management : Assuming you successfully completed the Integrative Management, Guidance toward implementing the strategy?

How do policies aid strategy implementation : How do policies aid strategy implementation? Illustrate your answer. What are Third Party Beneficiary Contracts and what are the Rights of the Parties?

Growth stage into mature phase of the life cycle : As an industry moves from the growth stage into the mature phase of the life cycle

Plan supports key objectives-internal and external equity : How your plan supports key objectives; internal and external equity. A retirement plan and how participation will be driven.

User Account

All Pages