Question: Nokia and Palm are competitors in the global marketplace. Access Nokia's annual report (www.Nokia.com) for the year ended December 31, 2009. The following information is available for Nokia.
(Euro millions) Current Year One Year Prior Two Years Prior
Inventories . . . . . . . . . . €1,865 €2,533 €2,876
Required: 1. Determine the change in Nokia's inventories for the last two years. Then identify the impact on net resources generated by operating activities (increase or decrease) for changes in inventory levels (increase or decrease) for Nokia for the last two years.
2. Would a move to a JIT system likely impact Nokia more than it would Palm? Explain.