may are expected to be s,000 units, how many units shoula be proddced 1 Mariaco

Question

may are expected to be s,000 units, how many units shoula be proddced 1 Mariaco has 40,000 pounds of krypton in inventory at the beginning of August. The company plans to produce 6,000 widgets tits only product) in August. If each widget requires 30 pounds of krypton and Katieco wants 50,000 pounds of krypton i inventory at the end of the month, how many pounds of krypton should the company plan to purchase during August 12 Jorgeco is planning to produce 2,000 boxes of jump ropes during June. Each box of jump ropes requ uires 0.50 hours of direct labor Employees of the company are paid S$11.00 per hour. What is the total amount that will be budgeted for direct labor for the month

Explanation / Answer

11. Calculation of Kypton to be purchased

To produce 6000 widgets it would require 6000*30 = 180,000 pounds of inventory

We have Opening Inventory= 40,000 pounds

Closing Stock which has to be maintained = 50,000 pounds

We will use the formula given below to find the amount the amount of purchases

Opening Stock + Purchases made (-) Closing Stock = Units Produced

Let units to be purchased be X

Therefore,

40,000 + X (-)50,000 = 180,000

X = 180,000 + 50,000 (-) 40,000

X = 190,000

Therefore company should plan to purchase 190,000 pounds.

Now moving to the next question,

12. Calculation of Budgeted cost for Labour

Units to be produced 2000 boxes

Hours to produce 1 box = 0.50 labour hours

So hours to produce 2000 boxes would be 2000*0.50 = 1000 hours

Labour are paid at a rate of $11.00 per hour

So total cost to be incurred for producing 2000 boxes would be

1000 hours * $11.00 per hour

= $11000

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