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Hi Sir,
I have an issue to understand how to work with waste percentage.
I am working on an exercise mentioning:
“Leather costs $10 per meter and 2m are needed to complete a chair although 20% of all leather is wasted in the assembly process”.I am trying to calculate the cost of leather per chair.
My reasonning and answer was: we use 2m per chair but 20% goes to waste so we actually need 2m*1.2 = 2.4m per chair. Cost = $10*2.4 = $24.But the answer is 2m * $10 *100/80 = $25.
I do not understand the ” *100/80 “. Could you please explain?
Many thanks,
AnneFor every 100 meters that they buy, they will waste 20 meters (20%) and have 80 meters available for production.
Putting it the other way round, for every 80 meters needed for production they will have to buy 100 meters.
So the amount they need to buy will always be 100/80 times the amount they need for production.
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