Question

Question 18
If sales forecast is 1200 units, opening stock is 200 units and closing stock is 500 and wastage is 25%, What is the total production requirement?
O 1,200
1,125
1,875
2,000​

Answer 1

Answer:

1125

Explanation:

because we deducted the wastage

Answer 2

Answer:

The total production requirement is 1125.

Explanation:

Given:

Sales forecast = 1200 units

Opening stock = 200 units

Closing stock = 500 units

Wastage = 25%

To find:

Total production requirement

Solution:

We know that the total production requirement is given as

Production required = (Closing stock - Opening stock) + Demand based on sales forecast

Therefore,

Production required = (500 - 200) + 1200

Production required = 300 + 1200

Production required = 1500

Since the wastage is given to be 25%, we subtract it from the total production units. Therefore,

Production required = 1500 - 25% of 1500

Production required = 1500 - 375

Production required = 1125 units

Therefore, for the given data, the total production required is 1125 units.

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