Budgeting Help

Hi All I am hoping that someone can point me in the right direction with regards to the attached practice question I have been able to work out all answers apart from the used in production & closing inventory values in pounds. Thanks in anticipation of your help Kind regards Charlotte Attachment not found.

Comments

  • kkelly
    kkelly Feels At Home Registered Posts: 51
    Hi Charlotte,
    This is one of those questions that you can get bogged down on easily....but here you go!
    Used in production is the 30,000 units produced * .55 kg of material = 16,500 kgs
    Closing inventory is therfore 17,600 - 16500 = 1100 kgs
    Closing inventory is valued at budgeted purchase price which is £ 27,125 / 15.500 kgs which is 1.75 per KG
    so closing inventory = 1100 kgs * 1.75 = £1925
    and the puchase figure is the balance £27,200
    Regards
    Kevin
  • Charlottec5779
    Charlottec5779 New Member Registered Posts: 9
    Thanks so much Kevin - that's a great help

    I cant believe how much I have been trying to over complicate that by doing all sorts of bizarre workings lol

    Best wishes
    Charlotte
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