ABC classes for nine finished items, weeks of supply, a carrying-cost total and a bottle reorder rule fill the MT236 Unit 5 inventory analysis, set out complete for one sauce maker. Searches like "mt 236 unit 5 assignment example", "mt236 unit 5 sample" and "mt236 unit 5 example" land here.
What a finished MT236 Unit 5 inventory analysis looks like
Five pages, three tables and one worked calculation. The ABC table ranks nine items by annual volume at cost, from green jalapeno at $103,680 to the gift pack at $12,600, with cumulative percentages: four A items make up 68 percent, two B items 18 and three C items 14. A second table adds stock on hand, weeks of supply and turns. The A items hold eight to eleven weeks; the ghost pepper and the twelve-ounce habanero hold about nineteen, the gift pack nearly 38. Finished stock totals about $99,400, which at a 25 percent carrying rate costs some $24,900 a year. The bottle calculation follows: weekly use near 5,770, a three-week lead time and one week of safety stock give a reorder point of about 23,100, and an order quantity near 32,100 becomes sixteen pallets.
How a MT236 Unit 5 example is structured
Classification comes first because it tells the reader where attention belongs before any stock level is judged. Items are ranked by annual volume at cost, not by cases, since a slow item with a high cost can matter more than a fast cheap one. Class boundaries are stated, and the paper notes that a nine-item line produces a flatter curve than the textbook 80-20 pattern. Weeks of supply and turns are then computed for every item and set against class: C items should carry little stock relative to their value, and here they carry the most. Carrying cost is built from its parts, capital, storage, aging and insurance, before the 25 percent rate is applied. The bottle calculation is worked in full with its units, then checked against the supplier's half-truckload minimum. Recommendations are ranked by the carrying cost each would release.
Dollars first, cases second
Annual cases multiplied by cost per case give each item's volume in dollars. The twelve-ounce green jalapeno sells fewer cases than mango habanero yet sits beside it in value, because each of its cases costs more.
Boundaries for a short line
With only nine items the curve is flatter than 80-20, so A is cut at about 70 percent of value and C covers the last 14. The paper states the cut-offs instead of forcing a textbook split onto the data.
C items that turn slowest
The three C items turn under three times a year while A items turn five to six times. Together they tie up about $27,800, or 28 percent of finished stock, for 14 percent of volume.
Twenty-five percent, built from parts
Cost of capital, warehouse space, product aging and insurance are estimated separately and summed to 25 percent of stock value, so any single component can be disputed without discarding the total.
Sixteen pallets at twenty-three thousand
Ordering costs $120 an order and holding costs seven cents a bottle a year, giving an order quantity near 32,100. Sixteen pallets are ordered whenever bottles on hand and on order fall to about 23,100.
Where marks go in MT236 Unit 5
Unit mismatches do the most damage here. An annual carrying rate applied to stock counted weekly, or cases and bottles mixed in one formula, distorts the reorder point and the order quantity together, and graders who recompute find it at once. Classifying by cases sold rather than by value comes up nearly as often, and it pushes cheap fast items into class A. Recommending lower inventory across the board, without saying which items or what a stockout of an A item would cost, reads as a slogan. Order quantities that stop at the formula, never checked against a supplier's minimum or pallet size, leave the answer unusable. Weeks of supply or turns are expected as well, because a stock level means little until it is compared with the rate of use.
Get a MT236 Unit 5 example written to your instructions
Send the stock counts and volumes the Unit 5 case gives, or describe the items of a business you know, together with the rubric. ABC classes, turns, carrying cost and a reorder rule come back in a first custom sample, free and ready within 24-48h. Every formula appears with its units so the arithmetic can be checked line by line.
MT236 Unit 5 questions, answered
Should ABC classes use units or dollars?
Dollars, in almost every course: annual units multiplied by unit cost. Classifying by units alone tends to put cheap, fast items in class A and expensive, slower ones in C, which reverses where control effort should go. If your data lacks costs, say so and use the best available proxy, such as selling price, labeled clearly as a proxy.
What does an inventory carrying cost include?
The cost of the money tied up in stock, storage space, insurance, and the risk that goods spoil, age or become obsolete. Rates between 20 and 30 percent of inventory value a year are common in textbooks, but a stronger paper builds its rate from components. Food products carry an aging component that, for instance, hardware would not.
Is the economic order quantity still used in practice?
As a starting point, yes. Real orders are then adjusted for pallet sizes, supplier minimums, price breaks and storage space, which is what the example does with its bottles. The formula's value lies in showing how ordering and holding costs trade against each other, and the total cost curve is flat near the optimum, so rounding to a practical quantity costs very little.