Product X requires 1.8 kg of a raw material per finished unit. The material has a weight loss of 10% in preparation for manufacture. Inventory of the material is currently 420 kg but needs to be increased to 500 kg. 2,000 units of Product X are to be manufactured.
How many kg of the raw material needs to be purchased to satisfy the above requirements?
3,920
3,880
4,040
4,080
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Materials
5y ago#1If 2,000 units are produced the weight of material in these will be 2,000 x 1.8 = 3,600kg. However, this represents only 90% of the input weight as 10% is lost. Therefore, input weight needed to make production is 3,600/0.9 = 4,000. In addition, an extra 80kg must be in inventory. Therefore, purchases = 4,000 + 80 = 4,080.
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