Current updates regarding coronavirus (Covid-19) and the precautions AAT are taking will be continually updated on the below page.

Please check this link for the latest updates:

We hope you are all safe and well and if you need us we will be here. 💚

Please check this link for the latest updates:

We hope you are all safe and well and if you need us we will be here. 💚

# AAT Level 4 Budgeting - Task 1.3 - HELP!!

Becco
Registered Posts:

**1**
AAT Level 4 Budgeting - Task 1.3 - HELP!!

I am really confused on where the numbers are coming from to figure out the closing inventory of finished goods

I get that it's total goods produced + opening inv - closing inv but I just don't seem to be able to get to the correct number!

I think I may be getting the total good produce number wrong or something?!

Could someone please explain the task and how the numbers are calculated?

Thanks you!

I am really confused on where the numbers are coming from to figure out the closing inventory of finished goods

I get that it's total goods produced + opening inv - closing inv but I just don't seem to be able to get to the correct number!

I think I may be getting the total good produce number wrong or something?!

Could someone please explain the task and how the numbers are calculated?

Thanks you!

0

## Comments

41Opening inventory is given as £150,000

Cost of production is the figures from the working schedules - Materials £569,275; Labour £514,800; Overheads £211,725. Total = £1,295,800

In the notes it says "Closing finished goods inventory will be valued at the budgeted production cost per unit", so the cost of production above divided by the units produced in the very first table ie £1,295,800 / 589,000 = £2.20 per unit. In the same table it says the closing inventory of finished goods is 81,400 units so multiplied by £2.20 = £179,080

3Becco I was stuck in exactly the same question as I am now!

Can anyone help me please?

Thank you

Kirsty

3Eg:

Reject rate: 8% (leaving 92% good production)

Good production: 68,700

68,700 74,674

--------- = 74,674 --------- x 8 = 5,974

0.92 100

I found laying it out like this helped me to:

%

8 - 5,974 - Rejected

92 - 68,700 - Good production

-----

100 - 74,674 - Total manufactured units

Hope this helps!

Kirsty

3Eg:

Reject rate: 8% (leaving 92% good production)

Good production: 68,700

68,700

--------- = 74,674

0.92

74,674

--------- x 8 = 5,974

100

I found laying it out like this helped me to:

%

8 - 5,974 - Rejected

92 - 68,700 - Good production

-----

100 - 74,674 - Total manufactured units

Hope this helps!

Kirsty