How much aluminum will Apple need to purchase in next year?

Apple’s CPO is planning a budget for purchasing carbon-free aluminium next year. There are 27.4 tonnes of aluminum in stock, while Apple will need 200 tonnes for production next year and double inventory for production in the following year.

How much aluminum will Apple need to purchase in next year?
A . 172.6 tonnes
B. 117.8 tonnes
C. 282.2 tonnes
D. 227.4 tonnes

View Answer

Answer: D

Explanation:

The quantity of aluminium Apple needs to buy is calculated as follows:

Quantity needed for production + the inventory needed at the end of the year – inventory at start of the year

That formula is quantified as: 200 + 54.8 – 27.4 = 227.4

Reference: CIPS study guide page 103

LO 2, AC 2.3