The Operations Manager likes your answer and thanks you for the analyses. He then asks you to do the ABC analysis. The manager adds that the company typically does ABC analysis such that the A segment (all A items togehter) accounts for at least 70% of value, B segment for at least 15% and C segment for at most 10% of value.

SKU Number of Items Value ($/item) Weight (lb/item)
A 220 67 52
B 225 3 59
C 245 21 60
D 145 7 48
E 230 26 42
F 240 83 49
Imagine, you want to first do the ABC analysis based on SKU value.

What percentage of the total number of items is accounted for by SKUs in segment B?

What percentage of the total value of inventory is accounted for by SKUs in segment B?

What percentage of the total weight of inventory is accounted for by SKUs in segment B?

Requirements are computed below.

Step-by-step explanation:

For ABC analysis:

Step1: Calculate the total value of each item.

SKUNumber of ItemsValue ($/item)Value of the product ($)

A2206714740

B2253675

C245215145

D14571015

E230265980

F2408319920

Step2: Reorganize the table on the basis of total value in descending order, & calculate % share of total value of investment and cumulative % share of total value of investment.

SKUNumber of ItemsValue ($/item)Value of the product ($)% of Total valueCumulative % of total valueSegment

SKUNumber of ItemsValue ($/item)Value of the product ($)% of Total valueCumulative % of total valueSegment

F240831992041.9641.96A

A220671474031.0573.01A

E23026598012.6085.60B

C24521514510.8496.44B

D14571015    2.14  98.58C

B2253675         1.42         100.00C

% of total number of items in segment B = (230+245)/1305 = 36.4%

% of total value of inventory in segment B = (12.6 + 10.4)/100 = 23.43%

% of the total weight of inventory in segment B = (9660+14700)/67795 = 35.93%

SKUNumber of ItemsValue ($/item)Weight (lb/item)Total weight

A220675211440

B22535913275

C245216014700

D1457486960

E23026429660

F240834911760

option 1 is correct.

step-by-step explanation:

y varies inversely with x and constant of variation is 4

the equation will be:

y = k/x

where k =4 so,

y = 4/x

if we put values of x of option 1 in the above equation and find values of y

y = 4/-2 => y =-2

y = 4/-1 => y = -4

y = 4/1 => y = 4

y = 4/2 => y =2

so, all the values of x and y are correct.

if we put values of x given in other options and find value of y we cannot find whole table satisfying the equation.

hence option 1 is correct.