b Centre 1 The most appropriate basis is to use machine hours as it is machine intensive... b The sales price variance will have arisen due to a higher selling price than budgeted being
Trang 1Answers
Trang 2Part 1 Examination – Paper 1.2
Section A
10 B
11 B
12 D
13 A
14 D
15 A
16 C
17 A
18 C
19 C
20 D
21 D
22 A
23 B
24 A
25 D
2 C 4–(0·95 + 1·25 + 0·7) = 1·1
Add: fixed costs in closing stock
Less: fixed costs in opening stock
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Receipts and issues
Trang 36 C
1·00512 × 5– 1
= 7,000
A –––––––––––
0·005
A A×69·77 = 7,000
7,000
A A=––––––
69·77
= 100·33 ≈100
7 D Materials
Usage 7,200 ×3 kg = 21,600 kg
kg
Opening stock (400)
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10 B hi 400,000 = fixed cost + variable cost per unit ×10,000
low 250,000 = fixed cost + variable cost per unit ×5,000 difference 150,000 = variable cost per unit ×5,000
variable cost per unit =150,000 ––––––– = £30
5,000
11 B
IRR = 10% + –––––––––––383 (15% – 10%)
383 – (– 246)
IRR = 10% + ––––––––––383 × 5%
383 + 246
IRR = 10% + ––––383 × 5%
629
IRR = 10% + 3% = 13%
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9,985 –––––
13 A
Trang 414 D
15 A ∑p3q3
=(130 ×2) + (135 ×4)
= 800 = 0·86 –––––– ––––––––——––––––– ––––
∑p3q1 (130 ×3) + (135 ×4)
= 930
16 C Labour required 500 hours
Spare capacity 400 hours no relevant cost
Remaining hours required 100 hours
100 hours from either:
overtime 100 × 1·5 × 12 = £1,800
100 production of X (100 ×12) + (—— ×4)= 1,400
2 therefore it is cheaper to take the hours from the production of X
17 A
18 C Volume variance
Budgeted volume 10,000 units
Actual volume 9,800 units
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At standard profit per unit × £5
Variance £1,000 adverse
19 C Breakeven sales revenue =fixed costs–––––––––
C/S ratio
Fixed costs = £200,000 – £50,000 = £150,000
C/S ratio = £200,000 –––––––––= 0·4
300
200
100
0 OF
C B
OF
100
y
x
Trang 520 D
5·747 – 3·312=
Net Present Value 12,351
21 D
Over absorbed fixed production overheads (6,000)
Absorbed overheads
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23 B
cost/unit =(2,000 ×£4·50) + 13,340 – (2,000 ×5% ×£3)
––––––––––––––––––––––––––––––––––––––––––
2,000 – (2,000 ×5%)
cost/unit = ––––––––£22,040 = £11·6
1,900
24 A
Should cost
––––––––
36,000 adverse
Should take
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2,500 favourable
£25,000 favourable –––––––––––––––––
Trang 6Section B
1 (a) Centre 1 Centre 2 Service A Service B Service C
500 ×50% = 500 ×20% = 500 ×20% = 500 ×10% =
–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––
400 ×45% = 400 ×45% = 400 ×10% =
–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––
750 ×60% = 750 ×40% =
–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––
40 ×50% = 20 40 ×20% = 8 40 ×20% = 8 (40) 40 ×10% = 4
–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––
8 ×45% = 4 8 ×45% = 4 (8) 8 ×10% = 0
–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––
–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––
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The total amount for overheads in production centre 1 is £2,906 and in production centre 2 is £4,094
(b) Centre 1
The most appropriate basis is to use machine hours as it is machine intensive
£2,906 ––––––––––
Overhead absorption rate =
3,000 hours
= £0·969/machine hour
2 (a) (i)
Total revenue Total costs
Variable costs
Fixed costs
Break-even revenue
Costs and revenue
£
Trang 7(b) (i)
(ii) Contribution would be established by taking the difference between profit and fixed costs
Cost of sales
Production costs:
Fixed production
Closing stock 27·5 = 22 ×(11,000 – 9,750) 27·5
Note: This figure can also be established by taking the absorbed fixed production overheads of 8 ×11,000 = £88,000 and adding the under absorbed amount of £8,000
(b) The sales price variance will have arisen due to a higher selling price than budgeted being obtained
The material variance may have arisen either because the number of kg used were more than expected, and/or the amount paid per kg was higher than expected
Fixed costs
Units 0
Breakeven point
Profit Profit
£
Loss
£
Trang 84 (a) EOQ =
EOQ = = 2,000 units
Purchase costs (12,000 ×£15) 180,000
Order costs12,000 –––––– ×200 1,200
2,000 Holding costs2,000 –––––×15 ×0·08 1,200
182,400
––––––––
––––––––
(c) Discounts are likely to increase the EOQ as the holding cost will be reduced
Since the purchase price is lower the total purchase cost will be reduced
As the order cost uses the EOQ to divide the total demand, this cost will be reduced as the EOQ has increased The holding cost will change as it uses both the increased EOQ and a reduced purchase price
price
MR ≥ MC at 1,300 units, therefore profits will be maximised at this point which is a selling price of £45
2C D
C o h
2 200 12 000
1 2
⋅ ,
£
Trang 9Part 1 Examination – Paper 1.2
Marks
Section A
2 marks per question giving a total of 50 marks
Section B
1 (a) reapportionment
Note: any method with sound bases for allocation
should be accepted and given full credit
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10
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4
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2
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10
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Trang 103 (a) Flexed budget
Variances
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10
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––-– 2
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10
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Calculation of marginal revenue (1/2per correct entry) 2
Calculation of marginal revenue (1/2per correct entry) 2
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