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Berry Fitzsimmons Limited Uses a Standard Metal Component in Its

Question 2

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Berry Fitzsimmons Limited uses a standard metal component in its production of lampstands (one component per lampstand) .The components can be supplied at very short notice, and so only 20% of the components required for the current month's production are kept in inventory.The opening inventory of components at the beginning of March 20X6 was 120, rising to 130 by the end of the month. Assuming that the inventory holding policy has been strictly applied, what was the increase in the production budget for lampstands between March 20X6 and April 20X6?


A) 24 lampstands
B) 50 lampstands
C) 10 lampstands
D) 2 lampstands

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