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Question 1: Henlow plc manufactures two products, Click and Flick. It intends to produce 2,000 units of
each product in the next year to meet the sales budget.
Each Click requires 2 kg of material Z and 1 kg of material Y and each Flick requires 3 kg of material Z
and 4 kg of material Y.At present there are 200 kg of Z and 500 kg of Y in inventory.
Henlow plc intends to increase the inventory levels of these materials by the end of the year to 600
kg of Z and 800 kg of Y.
Material Z costs $4 per kg and material Y costs $5 per kg.
What is the total materials purchase for the next year?
A. $86,900
B. $90,000
C. $93,100
D. $96,400
Correct Answer: C
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