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Accounting for Material.

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Accounting for Material.

  • This topic has 1 reply, 2 voices, and was last updated 3 years ago by John Moffat.
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    Posts
  • February 28, 2022 at 11:13 pm #649529
    sarbrina
    Participant
    • Topics: 57
    • Replies: 78
    • ☆☆

    Hi Mr. Maffot

    Can you please explain what to do with the resupply of 10000 units.

    ACB Co gradually receives its re-supply of inventory at a rate of 10,000 units a week. Other information is available as follows.

    Weekly demand 5,000 units
    Set-up costs for each production run $125
    Weekly cost of holding one unit $0.0025

    What is the economic production run?

    March 1, 2022 at 8:02 am #649542
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54775
    • ☆☆☆☆☆

    You need to use the economic batch quantity formula, as explained in my free lectures on inventory control.

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