Inventory Cash flow

Thoroughly Read and Examine the Case • Highlight relevant facts and key problems. Analysis of Case • Identify key problems and why they exist. • How do the identified problems affect the organization? • Who is responsible for the impact of these problems to the organization? Case Solution • What are the areas of opportunity for change? • Utilize additional research in conjunction with the text, and your own experiences (if applicable). • Ensure the solution is realistic. Draft the Case • Once the necessary information has been compiled, draft your case response in complete paragraphs (three to five sentences each) with the entire case response being at a minimum of 350 words in length (excluding the cover and reference page). The following is an excerpt from a conversation between Evan Eberhard, the warehouse manager for Greenbriar Wholesale Co., and its accountant, Marty Hayes. Greenbriar operates a large regional warehouse that supplies produce and other grocery products to grocery stores in smaller communities. Evan: Marty, can you explain what’s going on here with these monthly statements? Marty: Sure, Evan. How can I help you? Evan: I don’t understand this last-in, first-out inventory procedure. It just doesn’t make sense. Marty: Well, what it means is that we assume that the last goods we receive are the first ones sold. So the inventory is made up of the items we purchased first. Evan: Yes, but that’s my problem. It doesn’t work that way! We always distribute the oldest produce first. Some of that produce is perishable! We can’t keep any of it very long or it’ll spoil. Marty: Evan, you don’t understand. We only assume that the products we distribute are the last ones received. We don’t actually have to distribute the goods in this way. Evan: I always thought that accounting was supposed to show what really happened. It all sounds like “make believe” to me! Why not report what really happens? Respond to Evan’s concerns.