You have been provided with the following information for XYZ Supplies: Re-order quantity

10,000 units; Time required for delivery 2-4 months; Maximum consumption 2,500 units

p.m.; Normal consumption 2,000 units p.m.; Minimum consumption 1,500 units p.m

Required: Calculate,(5 marks)

i.Re-order stock level

ii.iii) Maximum stock level

iii.Minimum stock level

iv.iv) Average stock level

b) The following data relates to the repair cost incurred and the number of labor hours employed

by Toyotsu Auto Garage in a given week

Repair cost (shs)

600,000

800,000

550,000

1,000,000

700,000

500,000

Number of labor hours employed

4,000

5,000

3,000

6,000

4,000

2,000

Required:

(i)Create cost estimation equation using Range method.

(ii)Assuming that 2750hrs were employed, what would be the total cost?

(iii)If the total cost incurred is sh 750,000, determine the number of labor hours employed(5marks)

3.a) Green Farm Estates has the following accounting information:

shs

Sales729000

Direct labor142000

Purchases of raw materials240000

Selling expenses50000

Administration expenses60000

Inventories as at 1st July2016:

Raw materials64000

Work in progress50000

Finished goods96000

Inventories as at 30th June 2017:

Raw materials56000

Work in progress48000

Finished goods104000

Factory overhead is applied at the rate of 110% of direct labor.

Required:

Prepare a cost of goods manufactured statement for the year ended 30/06/2017(10marks)

b) The following information relates to product Y stocked by XYZ Limited for the month of June 2018.

Date:01June : Bought 2400units @18; 04June : Issued 3200units; 05June: Received 2600 units@20; 06 June: Issued 2700units; 08 June: Bought 3000units @21; 10 June: Received 2800units @22

The closing balance for May 2018 was a batch of 2800units received at a price of sh 20.

Required: Prepare stores perpetual inventory record for product Y using:

i.FIFO method

ii.LIFO method

 

iii.Determine the value of issues and closing stock.