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October 12, 2016 at 3:39 pm
i do not quite understand where you got the figures for decrease i n inventory under part D materials used. Can you please explain it to me?
John Moffat says
October 13, 2016 at 6:54 am
The question tells you what the opening and closing figures are for the inventory of Wood and of Varnish.
The decrease is simply the difference between the opening and closing inventories.
(I assume that you have printed out the lecture notes that are used with these lectures?)
August 7, 2016 at 11:23 pm
Investment appraisal is capital investment budget
Other Budgets are Functional, sales, production, Inventory, usage material , and purchase material budgets
cash, balance sheet, income statement and capital investment budgets and cash flow budgets are not functional but they are the master budgets ! am I RIGHT?
August 8, 2016 at 8:07 am
December 8, 2015 at 9:39 am
Sir i would like to know where can we find the ans for the example questions given in your lecture notes ?
December 8, 2015 at 10:59 am
Try looking on the contents page! The answers to both the examples and the test questions are printed at the end of the lecture notes.
(Also almost all the examples are worked through and explained in the lectures – you should not use the lecture notes on their own).
October 9, 2015 at 7:43 pm
Thank you once again for a great lecture.
October 9, 2015 at 9:35 pm
You are welcome 🙂
June 2, 2015 at 4:26 pm
What about Master Budgets. Are there no lectures on Master Budgets? And is master budgets important in exams point of view?
June 2, 2015 at 4:38 pm
Why do you not watch all the lectures??
There is not much point in picking one at random – if you watch our lectures in order then they form a complete classroom course covering the whole of what is needed to pass Paper F2 (provided, obviously, that you have the free Lectures Notes in front of you while you watch).
If you watch the first budgeting lecture (the introduction to budgeting) then you will find I explain what is meant by the master budget.
You cannot be asked to prepare a master budget – you can only be asked what it is and what budgets it is likely to include.
June 2, 2015 at 4:51 pm
Thank you for your reply. Yes I do watch your lectures in order but I wasn’t sure if it is required to prepare a master budget in exam.
Thank you for clearing my doubt 🙂
February 25, 2015 at 4:28 pm
Hey good day’
A little lost with (d), how did you get the 3000 and 1000 for inventory?
February 25, 2015 at 4:32 pm
3,000 and 1,000 are the changes in the inventory.
According to the question (in the Lecture Notes) the opening inventory of wood is 21,000 kg and the closing inventory is 18,000 kg. Since the inventory fell by 3,000 it means that 3,000 of the usage came from inventory and only the remainder needed to be purchased.
March 24, 2015 at 11:01 pm
Great. I was wondering the same thing. Perfect.
December 3, 2014 at 5:06 am
October 21, 2014 at 9:17 pm
One of the great lecture….Thanks for your support…I wish i could attend any of your lectures.
July 14, 2014 at 1:45 am
I couldn’t understood how inventory increase by 100,200,100????
July 14, 2014 at 9:37 am
I am away from home until tomorrow and so I will answer you then.
Please ask this question in the F2 Ask the Tutor Forum so that I do not forget 🙂
July 2, 2014 at 1:53 pm
They sell an equal number of each product.
Selling 1 of each of them give total revenue of 100+200 = 300.
So to get revenue of 900,000, then need to sell 900,000/300 = 3,000 units of each.
(In future, please ask questions in the F2 Ask the ACCA Tutor Forum – not here. This is for comments on the lecture. 🙂 )
July 3, 2014 at 12:35 am
July 2, 2014 at 1:40 pm
A company makes two products – A and B . The products are sold in the ratio 1:1 . Planned selling prices are $100 and $200 per unit respectively . The company needs to earn $900,000 revenue in the coming year. Required:
Prepare the sales budget for the coming year
Sir i need help in this
December 1, 2013 at 10:01 pm
Please look at this question
CA Co manufactures a single product and has drawn up the following flexed budget for the year.
60% 70% 80%
$ $ $
Direct materials 120 000 140 000 160 000
Direct labour 90 000 90 000 120 000
Production overhead 54 000 58 000 62 000
Other overhead 40 000 40 000 40 000
Total cost 304 000 343 000 382 000
What would be the total cost in a budget that is flexed at the 77% level of activity.
The answer states:
Direct material cost per 1% activity level = $2000
Direct labour cost per 1% activity level = $1500
at 60% $54000
at 80% ($62000)
Variable cost per activity change 1% change in activity = $8000/20 = $400
Substituting in 80% activity
Variable cost = 80 * 400 32 000
Total cost 62 000
fixed cost 30 000
Budget flexed at 77%
Direct material 77 * $2000 154.0
Direct labour 77 * $1500 115.5
Variable 77 * $400 30.8
other o/head 40.0
My question is how do you explain the $2000 and $1500 for direct material and direct labour respectively and is there is shorter way that the answer could be arrived at given time constraints in an exam.
December 2, 2013 at 7:10 am
Since at 60%, the materials are $120,000 then at 1% they must be 120,000/60 = $2,000. (It’s the same for 70% and 80% since it is a variable cost.
Same for labour – since 60% is $90,000 then 1% is 90,000/60 = $1,500.
No – there is not a quicker way.
r rupalia says
November 27, 2013 at 6:28 pm
Like the video with the lecture.
Great lectures, really helpful.
October 25, 2013 at 7:40 pm
Hi Sir John,
Can you please tell me why did you add 100 increase in inventory, while making a production budget? In the question it says inventory for finished good (which im assuming is ready to sell) so then why would we need to take this under production budget if it has already been produced and is under finished goods heading?
October 26, 2013 at 9:40 am
I assume that you are meaning about Product X.
500 inventory have already been produced (the opening inventory) but we are budgeting on the inventory increasing to 600 by the end of the year (the closing inventory). So……in addition to producing the 2000 that we intend to sell, we also need to produce an extra 100 in order for the inventory to increase.
(Or, if it more obvious for you – for the 2000 we budget on selling, 500 are already in inventory and so we only need to produce 1500. But that would mean there would be no inventory left at the end of the year. So we also need to produce another 600 in order to have the closing inventory – total production is again 2100)
October 26, 2013 at 2:22 pm
Its very kind of you for such a prompt reply.
Your explanation has cleared my doubt.
Thanks a million.
January 17, 2014 at 3:54 pm
formula to b use sales+cl.inve-open.inve=2100
August 18, 2013 at 3:40 pm
Where can I find the lectures for Capital budgeting and Standard Costing?
August 18, 2013 at 3:52 pm
Capital budgeting is chapter 21 of the course notes. Standard costing is the very first bit of chapter 22 (the important part is variances). There are lectures to go with both chapters.
September 11, 2013 at 7:02 pm
i cant find the lectures of capital budgeting?
September 11, 2013 at 7:49 pm
I have already written above – it is chapter 21 of the course notes (and chapter 20 is an introduction to it). There are lectures on both chapters.
Capital budgeting is not preparing budgets – it is appraising capital investments.
September 12, 2013 at 11:20 pm
yes, Thankyou verymuch.
August 10, 2013 at 3:00 pm
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I love opentuition! I love this teacher!
July 15, 2013 at 11:13 pm
This was really helpful. Thank You so much.
September 22, 2012 at 4:00 pm
please, can closing inventories of finished goods be lower than the opening? If so how will the production budget be?
November 13, 2012 at 7:05 pm
@jnyameboame, Yes – closing inventories can be lower than opening inventory.
In that case the production units will be lower than the sales units.
February 27, 2012 at 7:11 pm
It makes budgeting easy to understand.
February 19, 2012 at 7:41 pm
things make sense for the first time in life!
December 6, 2011 at 8:09 pm
well, this video is not working from midway through
December 6, 2011 at 9:56 pm
Wait for lecture to fully load before you press play
FREE ACCA says
September 17, 2011 at 6:07 am
opentution is not so best for exam preperation some lectures and topics are missing!
Miss A.. says
November 13, 2012 at 2:04 pm
@FREE ACCA, strongly disagreed………….
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June 21, 2011 at 11:35 am
this videox not workn
April 27, 2011 at 1:08 pm
i dont see anything just voice. is something wrong with my setting etc
September 17, 2011 at 6:05 am
please use latest windows for best videos quality and use pentium 4 system
March 13, 2011 at 2:42 pm
February 9, 2011 at 2:48 pm
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