Kirk Ltd manufactures picture frames. Each picture frame uses 0.5 metre of frame, 1 piece of glass, 1 backing board and 4 clips. A 'frame assembler' can make 50 frames in an 8 hour day, at an hourly pay rate of 10 per hour.

The frame material costs 50 per 100 metres, while a crate of glass sheets cut to size contains 200 pieces and costs 40. The backing board costs 20p per piece and the clips come in bags of 10,000 which cost 100.

The frames sell for 5 each and at the year-end Kirk Ltd has 250 completed frames in its warehouse.

What figure should be included in inventory in respect of the finished frames?

Answer rating: 100% (QA)

To calculate the figure that should be included in inventory for the finished frames we need to cons... View the full answer