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    5.2 Abc Analysis Problem With Solution

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    Cool Buddy
    This document classifies inventory items into categories A, B, and C based on their annual usage value. It provides data on the annual usage and unit price of 10 items. It then calculates the annual usage value of each item and ranks them in descending order. Based on the criteria that A items account for 70% of total annual usage, B items for 20%, and C items for 10%, it assigns the items to the appropriate category.

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    5.2 Abc Analysis Problem With Solution

    Uploaded by

    Cool Buddy
    835 views5 pages
    This document classifies inventory items into categories A, B, and C based on their annual usage value. It provides data on the annual usage and unit price of 10 items. It then calculates the annual usage value of each item and ranks them in descending order. Based on the criteria that A items account for 70% of total annual usage, B items for 20%, and C items for 10%, it assigns the items to the appropriate category.

    Original Title

    5.2 ABC ANALYSIS PROBLEM WITH SOLUTION

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    This document classifies inventory items into categories A, B, and C based on their annual usage value. It provides data on the annual usage and unit price of 10 items. It then calculates the annual usage value of each item and ranks them in descending order. Based on the criteria that A items account for 70% of total annual usage, B items for 20%, and C items for 10%, it assigns the items to the appropriate category.

    Copyright:

    © All Rights Reserved
    Download as XLS, PDF, TXT or read online from Scribd
    Download as xls, pdf, or txt
    835 views5 pages

    5.2 Abc Analysis Problem With Solution

    Uploaded by

    Cool Buddy
    This document classifies inventory items into categories A, B, and C based on their annual usage value. It provides data on the annual usage and unit price of 10 items. It then calculates the annual usage value of each item and ranks them in descending order. Based on the criteria that A items account for 70% of total annual usage, B items for 20%, and C items for 10%, it assigns the items to the appropriate category.

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    You are on page 1of 5

    Classify the following items into ABA

    Price/
    Annual
    Sr.No. Item unit
    usage
    Rs.
    1 Graphite 4000 10.00
    2 Toluene 800 5.00
    3 Wax 600 10.00
    4 Paraffin 2000 6.00
    5 Drums 1000 18.00
    6 Perfume 150 9.00
    7 Cartons 3000 0.20
    8 Starch 200 0.50
    9 Spirit 400 1.00
    10 Acid Hcl 250 6.00
    11 Carbon 700 15.00
    12 Nails 5000 0.10
    Classify the inventory items into ABC on annual consumption
    Value (Rupees) based on the following information
    item Annual usage unit price
    1 90 60
    2 40 350
    3 130 30
    4 60 80
    5 100 30
    6 180 20
    7 170 10
    8 50 320
    9 60 510
    10 120 20
    Use the following base for classification
    A items account 70% of the total annual usage
    B items account 20% of the total annual usage
    C items account 10% of the total annual usage

    Step 1
    Determine the annual usage value (Rs) for item by
    multiplying the annual usage (qty) by unit price (Rs) for each item

    item Annual usage unit price


    1 90 60 5400
    2 40 350 14000
    3 130 30 3900
    4 60 80 4800
    5 100 30 3000
    6 180 20 3600
    7 170 10 1700
    8 50 320 16000
    9 60 510 30600
    10 120 20 2400
    TOTAL 85400
    step 2
    Rearrange the items in the decening order of annual usage value
    as showing below:
    item value
    9 30600
    8 16000
    2 14000
    1 5400
    4 4800
    3 3900
    6 3600
    5 3000
    10 2400
    7 1700
    85400
    step 3
    Calclulate annual usage value of each item as percentage of the
    total annual value and also calculate cumulative percentage for
    the items arragned in the decending order in step no.2
    % total % of
    Annual usage annual cumulative
    Item
    value Rs. usage annual
    value usage value
    9 30600 35.9 35.9 35.83%
    8 16000 18.7 54.6
    2 14000 16.4 71 35.9+18.7=54.6

    1 5400 6.3 77.3


    4 4800 5.6 82.9
    3 3900 4.6 87.5
    6 3600 4.2 91.7

    5 3000 3.5 95.2


    10 2400 2.8 98
    7 1700 2 100
    STEP 4
    Classify the items listed above as ABC using the given basis
    for classification
    class item % of cumulative annual usage value
    A 9,8,2 71
    B 1.4,3,6 20.7
    C 5,10,7 8.3
    =30600/85400%

    98

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