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Resort Bicycle Rental

Resort Bicycle Rental. Excel Learning Aid Page 87 MGS 3040-03 GROUP C Justin Bornstein Dagmara Galik Svitlana Panasik Ulascan Senger. Inventory Formulas in Use. Using Excel for Inventory . These formulas are used to analyze the Resort Bicycle Rentals.

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Resort Bicycle Rental

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  1. Resort Bicycle Rental Excel Learning Aid Page 87 MGS 3040-03GROUP C Justin Bornstein Dagmara Galik Svitlana Panasik Ulascan Senger

  2. Inventory Formulas in Use

  3. Using Excel for Inventory • These formulas are used to analyze the Resort Bicycle Rentals. • Cost of Current Inventory=Bike Cost x Number on Hand • Revenue per Bike=Total Rental Revenue/Number on Hand • Revenue as a Percent of Cost of Inventory=Total Rental Revenue/Cost of Current Inventory

  4. Other Formulas • Value of Inventory= Sum of the Cost of Current Inventory • Average aggregate inventory value = # of units on hand x total value of units • The average aggregate inventory value is the total value of all items held in inventory by a firm. • Inventory turnover = # of Rentals / inventory on hand • To improve inventory turns, managers should look at popularity of their bikes; which bicycle is being rented the least and the most often • Total value tells managers how much firm’s assets are tied up in inventory. • Total business revenue= Sum of the Total Rental Revenue of each bike • Net Income= Total Business Revenue- Average Aggregate Inventory • Current Return on Asset= Net Income / Average aggregate Inventory

  5. Showing New Calculations

  6. Managerial Critical Thinking

  7. Critical Thinking and Decision Making for Resort Rental Bicycle • Effective decision makers are those the rare individuals who are able to consistently identify and choose the best option among multiple alternatives and the provided data. • Looking at the new data for Resort Rental Bicycle business, removing the LiteLift Pro branded bike will increase the overall revenue and save costs in total inventory.

  8. Manager’s Decisions • Decisions and conclusions that may be drawn from the data: • LiteLift Pro bike should be discontinued from the rental • Revenue not high enough to cover costs and make profits • Should invest in buying bikes that generate higher revenues: Wonder Bike II, LiteLift Laders and LiteLift Racer • Decision whether the aggregate value is too low or too high by historical or industry comparisons or by managerial judgment • Reducing aggregate inventory investment will increase ROA.  • Objective: to have the proper amount of inventory not the least amount of inventory

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