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Chau says

Sorry sir,

About the question 4, refer to the wrong answer A: $3, the answer in the course note says “if you selected option A you aportioned costs on the basis of units sold”. I don’t understand how can we get that incorrect answer? I guess that we would incorrectly sum opening stock, direct material, conversion costs and closing stock together, then just simply divide the result ($240,000) by the total production units (80,000 u). Is that right?

Sorry for annoying you with this useless question. I hope to hear from you soon.

Thank you

John Moffat says

What you have written is correct

Chau says

Thank you!!

Hizamudeen says

chapter 13 question 4 how did you workout the 75000, i got no clue can someone help me please

thank you

John Moffat says

I assume you mean the 75,000 joint cost apportioned to product X and product Y?

The joint cost is 200,000 in total. It is apportioned on the basis of the sales value of the production. The total sales value of the production is 320,000 of which X is 120,000 (the workings for these figures are printed in the answer).

So if X has sales value of 120,000 out of a total of 320,000, then the joint cost is apportioned on that basis i.e. 120,000/320,000 x 200,000 = 75,000

akshit says

hey, can we be questioned from chapter 14? thanks

Hasibullah says

Is here chapter no 14

John Moffat says

There is no lecture on Chapter 14 because you cannot be asked any calculations on alternative cost accounting.

All you need is what is written in the notes – you can read that yourself!

Hasibullah says

Thank u sir

Laura says

Good morning Sir,

Can you please help me with an answer to this question about Labour turnover rate: 3200 workers at the beginning of the year, during the year 1720 left, 2000 were at the end. After my calculation I got 1720[(3200+2000)/2 ]*100=66% but the answer given by the test is 20%?!

Thank you in advance,

ebi says

In a company’s processes,product X is manufacturing using raw materials P and T which are mixed in the proportions 1:2. Material purchase prices are: P £5.00 per kilo,T £1.60 per kilo. Normal weight loss of 5%is expected during the process. In the period just ended 9,130 kilos of product X were manufactured from 9,660 kilos of raw materials. Conversion costs in the period were £23,796. There was no work in process at the beginning or the end of the period. Prepare the product X process account for the period. Thank you

John Moffat says

You cannot be asked to prepare a t-account in the exam, and I cannot write one up here.

However I will calculate the relevant figures for you (which obviously you can be asked).

I assume that you have watched my free lectures on process costing.

9660kg were input. Since P and T are in the ratio 1:2, P must be 1/3 of the input and T must be 2/3.

So the cost of the materials is for P, 1/3 x 9660 x $5 = $16100; and for T is 2/3 x 9660 x $1.60 = $10,304. So total materials cost is $26,404.

In addition there are conversion costs of $23,796, which bring the total cost to $50,200.

The cost is spread over the expected output, which is 95% x 9,660 = 9177 kg.

(Questions like yours are best asked in the F2 Ask the ACCA Tutor Forum. This space is for comments on the lecture.)

So the cost per kg is 50,200/9,177 = $5.47.

The output is therefore valued at 9,130 x $5.47 = $49,941.

There is an abnormal loss of 9,177 – 9,130 = 47kg. So this is valued at 47 x $5.47 = $257.

Grace says

Hello Sir,

I have a question on page 74 question 4, when we calculate the production in one period should be less opening stock and plus closing stock, right? I am confused in this question solution, why you calculate the joint cost, pulsing open stock $40000 and lessing closing stock $2000??

Thank you very much for your explanation in advance.

John Moffat says

The cost of production is always opening inventory, plus purchases, less closing inventory.

Here, instead of purchases we have the cost of materials and conversion costs.

bletam says

please can anyone tell me how we got 0.6666 as the cost per unit of x in the test on joint product in question 1? thanks

John Moffat says

When P and Q left the process, the cost per unit for both of them is the joint cost (350,000) divided by the total production (750,000 units). This gives a cost per unit of 0.46666.

Q the has further work done (to turn it into X) at a cost of $66,000 for production of 330,000 units, which means there is an extra cost of 66000/330000 = 0.2 per unit.

So…the total cost per unit for X is 0.46666 + 0.2 = 0.66666

neilsut says

Hi, is there a typo on page 78 question 4? Output and sales for product “Z” should be for product “Y”? I think I know the answer, but thought I should check.

John Moffat says

You are correct.

Thanks – I will have it corrected.

claudette says

but then 40% was used instead of 60% for opening work in process still question 9

John Moffat says

40% in the answer is correct. (60% work was done last year on the opening work in progress – only 40% work is therefore done this year)

accakeisha says

very well explained

Reena says

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