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AT Co makes a single product and is preparing its material...

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Costing
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AT Co makes a single product and is preparing its material usage budget for next year Each unit of product requires 2kg of material, and 5,000 units of product are to be produced next year Opening inventory of material is budgeted to be 800 kg and AT co budgets to increase material inventory at the end of next year by 20%. The material usage budget for next year is

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Correct Answer: Option C
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4 Comments
Lubega Charles
Lubega Charles 5 years ago
its
2x5000
=10000
Agney Galande
Agney Galande 5 years ago
Next year's Opening Inventory = 800kg
Increase in material inventory by end of next year = 20%.
20% of 800kg = 160kg.
Therefore, next year's Closing Inventory = 800+160=960kg.
Required Material = 5000 units x 2kg = 10,000kg.

Total Units Required / Consumption = Opening Stock + Purchases - Closing Stock
=> 800+10,000-960= 9,840
Girish R
Girish R 8 years ago
with solution this quetion
Kumar Gaurav
Kumar Gaurav 8 years ago
10000+960-800 = 10160
how ans is 10000
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