Kumquat plc (see Activity 13.2) uses two basic raw materials Dructose and Zitamint to make
Question:
Kumquat plc (see Activity 13.2) uses two basic raw materials – Dructose and Zitamint –
to make its products. Ingredients are mixed in the following quantities to make one unit of each product:
Dructose kg Zitamint kg Limbards 2 2 Mintons 2 1 Nestrals 3 1 Obloids 1 1 Sales in January are forecast as follows:
Units Limbards 2,857 Mintons 2,286 Nestrals 1,714 Obloids 1,143 Opening inventories of each raw material at 1 January are Dructose 5,000 kg, Zitamint 4,000 kg. Losses by evaporation in a month are equivalent to 10, of opening inventory levels. Each kilogram of Dructose costs £6 and each kilogram of Zitamint costs £4.
Show a materials purchase budget for January only, on the assumption that opening and closing inventory levels are to be identical, and that there will be no opening inventories of completed units at 1 January.
Step by Step Answer:
Accounting And Finance For Business
ISBN: 9780273773948
1st Edition
Authors: Geoff Black, Mahmoud Al-Kilani