If 61,000 pounds of raw materials are needed to meet production in August, 52900 Pounds of raw materials should be purchased in July.
The inputs utilized in the creation of finished goods that are offered for sale to consumers are known as raw materials. Due to this, raw materials play a crucial role in both the global economy and international trade. A country's exports can increase and its GDP can increase if it has natural resources that can be used as raw materials. Through commodities markets, companies and investors can trade raw materials. To keep track of their inventory of raw materials, manufacturing enterprises adopt particular measures. On its balance sheet, this includes three different inventory classifications as opposed to simply one for non-manufacturers. The balance sheet's current assets section lists the assets that are most likely to be depreciated within a year, including the following:
To solve the question :
Production in July :
= 10000 + (12000 × 20%) - (10000 × 20%) = 10400 Units
Raw material should be purchase in July :
= (10400 × 5)+(61000 × 10%) - (10400 × 5 × 10%)
= 52900 Pounds
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The complete question is attached below :
If 61,000 pounds of raw materials are needed to meet production in august, how many pounds of raw materials should be purchased in july?
