Inventory Turnover and Restaurant Dynamics
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Questions and Answers

How many units does the manufacturing company sell per year?

  • 40,000 units
  • 50,000 units
  • 20,000 units
  • 30,000 units (correct)
  • What is the flow time for the company's inventory in months?

  • 4 months
  • 8 months (correct)
  • 6 months
  • 10 months
  • What is the inventory turnover rate of the manufacturing company?

  • 2.0 turns per year
  • 1.0 turns per year
  • 1.5 turns per year (correct)
  • 2.5 turns per year
  • What would be the absolute inventory cost for a product that costs $1,000?

    <p>$166.66</p> Signup and view all the answers

    How many guests can be seated at Penne Pesto during its operating hours?

    <p>200 guests</p> Signup and view all the answers

    What is the average time a guest spends in the restaurant, including waiting and dining?

    <p>50 minutes</p> Signup and view all the answers

    How long does it take for the restaurant to clean a table after a guest leaves?

    <p>10 minutes</p> Signup and view all the answers

    What happens if there is no available seat at Penne Pesto?

    <p>Guests simply move to another place</p> Signup and view all the answers

    Study Notes

    Inventory Turnover Calculation

    • A medical device manufacturing company generated $60,000,000 in sales, with $20,000,000 worth of inventory at year-end.
    • Each unit in inventory costs $1,000 and sells for $2,000.
    • The company's inventory turnover rate is 1.5 turns per year, calculated by dividing the cost of goods sold (COGS) by the average inventory value.
    • The company's inventory cost is 16.66% per year, calculated by dividing the annual cost of inventory by the inventory turnover rate.
    • The per-unit inventory cost for a $1,000 product is $166.66.

    Penne Pesto Restaurant Dynamics

    • Penne Pesto is a San Francisco restaurant with 50 seats.
    • The restaurant is always full during its four-hour evening service.
    • Customers arrive spontaneously and have no reservation system.
    • The average customer spends 50 minutes in the restaurant, broken down as follows:
      • 5 minutes for seating and ordering.
      • 10 minutes for food preparation.
      • 30 minutes for dining.
      • 5 minutes for check-out.
    • It takes 10 minutes for the restaurant to clean and prepare a table for the next customer.

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    Description

    Explore the calculations and dynamics for inventory turnover in a medical device company and evaluate the operational flow of a busy restaurant. This quiz covers important business concepts such as sales, inventory management, and customer service efficiency.

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