QUESTION 2 Answer the questions from the information provided.

2.1 Use the information provided below to calculate the number of units of Product Tex that must be produced for July and August. (4 marks)

INFORMATION The estimated sales volume of Product Tex is 25 000 units for June, 21 000 units for July, 30 000 units for August and 36 000 units for September. The policy of management is to maintain an ending finished goods inventory each month equal to 20% of the current months budgeted sales and 30% of the following months budgeted sales.

2.2 Study the information provided below and calculate the expected value of closing inventory as at 31 December 2022, if the FIFO method of inventory valuation is used. (4 marks)

INFORMATION The following information was supplied by Sunbeam Manufacturers for 2022 in respect of its finished goods:

	R
Inventory on 01 January	640 000
Cost of production of finished goods manufactured	570 000
Cost of goods sold	435 000
Sales value of the goods sold	675 000

2.3 Use the information provided below to determine the cost (as a percentage, expressed to two decimal places) to Banda Stores of not accepting the discount. (4 marks)

Information

Fego Manufacturers granted credit terms of 60 days to Banda Stores but the manufacturer is prepared to allow a rebate of 2 % if Banda Stores pays the account within 12 days.

2.4 Use the information given below to calculate the annual Economic Order Quantity. (4 marks)

The following details have been supplied by Nola Limited for one of its products:

Sales per month	7 500 units
Carrying costs as a percentage of the unit purchase price	20%
Purchase price per unit	R100
Cost of placing an order	R10

2.5 Study the information given below and calculate the value of closing inventory as at 31 March 2022 (4 marks) using the weighted average cost method.

INFORMATION

Printgo Suppliers had an inventory of 10 printers at R2 000 each on 01 March 2022. The following transactions took place during March 2022 in respect of the printers that it sells:

08 March	32 units at R2 100 each were purchased.
09 March	12 units purchased on 08 March were returned to the supplier.
20 March	20 units at R2 200 each were purchased on 20 March 2022.

Printgo Suppliers sold 40 printers at R4 000 each during March 2022.