- This topic has 1 reply, 2 voices, and was last updated 1 year ago by .
Viewing 2 posts - 1 through 2 (of 2 total)
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.
December 2023 - June 2024 exams:
Get your discount code >>
Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Costing
House Co also plans to manufacture 90 sofas in june. Below are some extracts from the cost card for a sofa.
Materials- 10m^2 of fabric @$50 per m^2. =$500
Assembly labour- 8hours @$15 per hour =$120
How many metres of fabric should be purchased if 10% of material is wasted during the production process?
Sir i know required for production is 900m^2 {90×10)
But in kit they’re adding waste =100 from where is this coming from 10% of 900 would be 90, also why we adding it with usage it’s like normal loss which we deduct from input to find output, please explain this sir
The cost card is showing the material being used in production which is 900 m^2
For every 10 m^2 purchased, 10% is wasted and therefore only 9 is available for production.
Putting it the other way round, for every 9m^2 used in production they will need to purchase 10m^2.