Inventory

gareth1985
gareth1985 Registered Posts: 24
Hi there,

after getting the £22 per kilo figure. I just don't know how to get those other figures. Please help.

Thanks,

Gareth

Comments

  • Vickie30
    Vickie30 Registered Posts: 24
    Hi Gareth,

    I'll work all the way through so you can see the whole process if it helps.
    So the total of the inventory is (500+1200+2000) = 3700 kilos.
    Total prices are (£26x500=13000, £22x1200=26400, £21x2000=42000) = £81400.
    As we are doing AVCO, you divide the total cost by the total kilos and you will get the £22 per kilo.
    It then says there was an issue of 1800 kilos for production and you have worked out the cost per kilo above.
    1800 kilos x £22 = £39600
    You started with 3700 kilos in inventory, there was an issue of 1800 kilos for production (3700-1800), so you are left with 1900 kilos left in the inventory.

    I hope this helps and makes sense!
    Vickie
    AATQB - Studying Level 4
  • gareth1985
    gareth1985 Registered Posts: 24
    Hi Vickie,

    that all makes perfect sense. Thank you so much for the help:)
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