Home For AAT student members AQ 2016 Professional Diploma in Accounting Management Accounting: Budgeting
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HELP

Hi,

I’m struggling to get to the answer on practice assessment 1, task 3 for budgeting. Can someone please explain how they get the answer for the production @1.45 per kg?

Comments

  • dumutrobadumutroba AAT Student, AATQB Posts: 264
    edited November 2018
    348000x0.7kg=243600kg used in production
    243000+7400 closing inventory =251000 kg sub total
    251000-8800 opening inventory =242200 purchase @ 1.45=£351190
    AAT Level 2. 2018 Distinction
    AAT Level 3. 2018 Distinction
    AAT Level 4. 2019 FSLC 100% MABU 93% MADC 82% PDSY 80%
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    Nataliedory
  • NataliedoryNataliedory AAT Student Posts: 26
    Thank you. Are you able to help me on task 3 b) how to work out the closing inventory of finished goods figure to get to £95,760?
  • dumutrobadumutroba AAT Student, AATQB Posts: 264
    edited November 2018
    Closing inventory of finished goods is multiplied by the production cost per unit
    Closing inventory you take from the scenario, production cos per unit you get when you devide the total production cost to the number of production units
    AAT Level 2. 2018 Distinction
    AAT Level 3. 2018 Distinction
    AAT Level 4. 2019 FSLC 100% MABU 93% MADC 82% PDSY 80%
    Xero Certified Advisor
    Nataliedory
  • NataliedoryNataliedory AAT Student Posts: 26
    I must be using the wrong figures because it isn’t coming to that total? Thank you for your help x
  • NataliedoryNataliedory AAT Student Posts: 26
    Don’t worry I’ve done it xx
  • molly_molly_ Registered Posts: 4
    I saw this and thought it might be useful for anybody else to see the figures used:

    Production cost: £974,400
    Total number of production units: 348,000
    974,400 / 348,000 = £2.80

    Closing inventory given in the Scenario of: 34,200 x £2.80
    = 95,760
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