LOGISTICS MANAGEMENT 24 SUPPLEMENTARY EXAS MODULE + Logistics Management 2A cope + LBEZAO1 / LMAt2A2 DATE + duly 2016 DURATION + 180 Minutes TOTALMARKS =: 140 EXAMINER Me P Kilbourn MODERATOR + Prof J Walters NUMBER OF PAGES : 12Pages INSTRUCTIONS TO CANDIDATE: ‘Answer al the questions. Use the Multiple Choice Answer sheet provided to answer section A Question papers must be handed in, ‘This is a closed book assessment. Read the questions carefully and answer only what is asked. ‘Number your answers clearly. Write neatly and legibly ‘Structure your answers by using appropriate headings and sub-headings. ‘The general University of Johannesburg policies, procedures and rules Pertaining to writen assessments apply to this assessment.Se SECTION B [90 MARKS} ‘QUESTION + (10 marks) 'denty the range of etivtes that can form part of a business logistics process and expan what ic ‘meant wth a tota-cost or systems approach to the management ofthese activities (io) QUESTION 2 (13 Marks) 2.1) — Disoves the importance of service effectiveness from a lopstics perspective. (3) 22) Descrive the key post-ransacion elements of customer service (4) 2.3) Fully discuss product avaiabilty as a service performance contol issue with specif ‘reference to: stockout frequency; fi rats; and order shipped complete (8) Questions (9 Marks) A logistics manger needs to understand the key financial concepts applying to the matagemert of a business enterprise. 3.1) Explain the concept of Grose Margin and how it can bo improved (3) 3.2) Explain the concept of Net Profit and what logistics managers can do to improve it (4) 53:3) Explain the importance of cash fora company (2) ‘question « (7 Marks) Moumalanga Traders L1s buys and sells one type of advanced electronic measuring insvuont Undereath is a recent proft calculation for Mpumalanga Traders Lid for tne last hana voor a Sales (30 000 unt) 10500 000 Lest Variable expenses 7 000 000 Fixed expenses 1.000000, Net prof 00 441) Caleulate the contibution margin per product (2) 4.2) Caleulae the break-even sales lvel fr Mpumalanga Traders Lis (2) 43) Calculate the Margin of Safty (in Rands) for Mpumalanga Tasers Lec (2) 44) The compary is renegotiating the lease ofa bulding which f successful wil reduce rntal costs witn RE000 per month. What would be the impact of such a cost redetion on the break-even point (assure al else remain the same)? (1)LOGISTICS MANAGEMENT 2h SUPPLEMENTARY EXAM 2016 10 QUESTIONS. (8 Marks) ‘You have been offered to buy shares in a small company (Bona Hokings PTY Ltd). Due to Your training in the Diploma in Logistce Management you understand that you have to fist determina the present vale of future free cash flows end asset values In order to determine wheher the price ‘offered to you is fai. From your analyes you obtained the following iYormation: According to the (CEO of Bona Holdings PTY Ltd the company expects to generate the fllowing free cach flows ‘ver the next four years: ‘tert year. R70 000 ‘ter 2 years: R90 000 ‘AMter3 years. R110 000, ‘Attar 4 years: R120 000 Itis also expected thatthe terminal aaeet value of Bona Holdings PTY Lid wil be worth R450 000 ‘ater four years The expected rete of return on equtys 15%. Currently there are 500 shares in the ‘company. 51) Calculate the total present va ofthe expected future free cash lows (4) 5.2) Calle the current value ofa share forthe company (2), 5) The price charged per share is Ri’ 200.00. Doos it represent good or poor vale? Briefly motivate your answer (2) QUESTION 6 (9 Marks) Undemeatnis he income statement and Balance sheet for FastMove Carirs for Feb 2015. Use these statorens to answer the questions that flow. Income statement Balance shoet R R Revenue 780 000 Food assets 3500000 Less cost of gcods sold 500 000 Current assets 100000, Gross Proft "280 000 Total assets 1450 000 Less expenses incurred 450.000, Profit befor inerest +30 000 Equty 2000000 Interest 50.000 Long-term dest 150000, Prof before tac 180.000 Curent abies _100 000 Tax 30.000 EEquiy and abies 450 000, Prof afer tx Return on equity) 60 000 6.1) Calculate the Net profit margin (2) 82) Calcuai the asset turnover 2) 6.3) Galculas retum on assets (2) 64) Caleulat return on equity (3) ‘quesTion 7 (10 marks) ‘Atican Distributors operates in the real industry and soll various high technology products. One ifthe products sold by the company isan electronic measuring devise by the code name HY23, ‘Te logistics manager needs to plan the inventory fortis tem. 7A. What would be the most economic order quantty for HY23_ given the folowing Information (show all your calculations and base yout answer on tne toal of annual orderLOGISTICS MANAGEMENT 24 SUPPLEMENTARY EXAM 2016 4 costs, annual canying costs and annual transport costs). (Formulas which you may fn Useful are provided onthe last page o this question paper ‘© Anmual demand volume = 50000 units © Unitvalue at cost = R1500 + Inventory carving cost percentage = 12% annually + Ordering cosa, incloding handing = R&5O per one: ‘Transport costs for quarttes below 700 units = R35 per unit ‘Transport costs for quanttes of 700 units or more = R30 per unt 7.2. Calculate the safely stock requirements for HY23, given the following information ‘= Standard devation of weekly sales ~ 25 unis ‘Standard devation of the load time = 0.35 weeks 2 Average weekly Average lead time = 2 weeks Service level requirement QUESTIONS. (10 Marie) Discuss the folowing procurement cost management stateges: 841) Speculative buying (2) 82) Forwars buying (2) 83) Prico-change management (2) 84) Volume contracts (2) 85) Heoging @) QuesTions: (9 Marks) Logistics manager Johan Pieters needs to consider trade-offs between inventory folding costs and stock-out costs, He understands the cost ofa slockout but asked for your advise, a8 logistics ‘graduate, on the costs associated wil inventory holding. Fuly adviee on inventoy carving costs 8nd how't is calculated ‘QUESTION 10 (S Marks) In addition to the basic modes, the intemetional goede transport user can make use of non ‘operating service providers. Diecuss tho vee of Non veasal operating semmon ceriers (voces) (5) Aid/Formulas relevant to section B:ots ma ceuenr 4 surLEMEanY a0 2 rat a oe = ae ee 5 fe Soe oe eS Fd ou Ge Ee is is Be ee ie i oe 2 es is ig i Ge ee es = i ee 8 8 oS Ge ee 2 2 SR ee i oe Be ue ig Bee 22 Be 2 Bie 2 eS ; cece ee @ ig GS Ge G2 ee i ig Eg EP eB ie ig ig OEE POR OBR BR 38 premier eq rvervattenen Gwin o.< BIDS OQ = \2AS1CV