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Question - CKC Sdn Bhd produces two products: SR200 and TX500. Budgeted sales in units for the following four months are given below:
Months
SR200
TX500
May
8,000
20,000
June
13,000
32,000
July
11,000
39,000
August
18,000
46,000
CKC's ending inventory policy is that SR200 should have 15% of next month's sales in ending inventory and TX500 should have 40% of next month's sales in ending inventory. On May 1 2018, there were 1,200 units of SR200 and 9,000 units of TX500.
TX500 requires 6 units of component A. SR200 does not use component A. There were 30,000 units of component A in inventory on May 1. KC wants to have 20% of the following month's production needs in inventory for Component A.
Required -
(i) How many units of TX500 are budgeted for production in June?
(ii) What is the budgeted production of SR200 for May in units?
(iii) What is the budgeted amount of component A to be purchased in May?
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