Accounting Information Systems 1st Edition by Vernon Richardson,Chengyee Chang ,Rod Smith

Exercise 11

In 2002, John Deere's $4 billion commercial and consumer equipment division implemented supply chain management software and reduced its inventory by $500 million. As sales continued to grow, the company has been able to keep its inventory growth flat. How did the supply chain management software implementation allow John Deere to reduce inventory on hand? How did this allow the company to save money? Which income statement accounts (e.g., revenue, cost of goods sold, SG A expenses, interest expense, etc.) would this affect?