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A company produced 6,200 units of a product in a period. The product used 80 kg of material per 100 units of output. The inventory holding of the material reduced by 380 kg in the period. What quantity of material was purchased in the period?
You should know from basic trading accounts that:
Cost of sales = Opening stock + Purchases – Closing stock
You can easily change monetary amounts into physical quantities so that:
kg used = Opening kg + purchased kg- Closing kg.
Kg used used is easy to work out from the question.
Opening kg – Closing kg = 380Therefore work out purchased kg.
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