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Throughput accounting
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Dear Sir, thank you very much for the great lecture!
I still have a question about the throughput accounting ratio (TPAR) though. In the exam when we are asked to calculate the TPAR in a multi-product scenario, should we calculate the TPAR for each product individually or for all the products as a whole? What I mean by ‘as a whole’ is to get only one TPAR by using the total throughput at the optimum production plan.
Looking forward to your answer! Cheers!
You should calculate it for each product separately.
I am having problem with video i can’t see it anymore help
The lecture is working fine. If you are still having problems, go to the technical support page – you might find the answer to your problem there.
What a Lecture! Thanks
I was looking into BPP materials on this topic, found lot of it confusing and this theory of constraint.
I’ll second that – fantastic lecture! I’ve been struggling with the Kaplan material. Watching the lecture I found that I was understanding the whole process and could follow each step and it’s now all making sense. I’m a lot more confident now if this comes up in the exam. A big thank you!
you are,this lesson will remain a vital asset for me.
I really need help with f5 anyone willing to help?
How? Do u want a study-mate?
Yes I really do.
Alright maybe we could study together. I am writing F5, F7, F8 and F9.
Great – good luck
If there are any problems that you cannot sort out together then please do post them in the ‘Ask the Tutor’ forum and I will do my best to help.
this lecture was awesome
Good lecture. It seems a little strange to me that you calculate your fixed cost based on your original budgeted hours in throughput accounting considering they won’t be your fixed costs as you won’t be working to maximum capacity but if that’s they way to do then that’s they way I’ll do it.
But fixed costs by definition will not change with the hours worked.
True but then why have a fixed cost per unit (as shown in example 2 page 17 as this would change depending on the number of units produced. The fixed cost should just be given as an amount really no? I understand by definition it shouldn’t change just seems a contradictory that it is fixed per unit and not fixed up to a certain production volume.
The cost card has been prepared using absorption costing (because fixed costs are there – they have been absorbed into the unit cost).
However this is not assuming that the actual fixed cost per unit stays the same. The cost card is prepared using budget figures i.e. budget total fixed costs and budget production (in order to, for example, help decide on what selling price to charge).
However, in both conventional contribution analysis (example 1) and throughput accounting (example 2) we assume that the total fixed costs will stay the same. That is why we have calculated the total budgeted fixed costs (using budget production and budget cost per unit) and then assumed that that total remains fixed,
(Absorption costing and marginal costing are not examined specifically in F5 because they were in F2, but the ideas are relevant in, for example, the examples in this chapter. If you want more on absorption and marginal (and the reasons in practice for choosing one method or the other) have a look at the lectures for F2)
No that makes sense the fact that it is prepared using budgeted figures. Cheers
Good day Mr John. Thanks for your insightful lectures. However, I noticed in the second example when deducting the fixed costs for both companies, you included ‘other variable costs’ in the equations as well. I wonder why this is so. Thanks for your help always.
It is because throughput accounting treats all costs as fixed (in the short term) except for materials.
Are the lectures disabled for mobile devices? They say page not found every time I try to access.
No – they should work on mobile devices also.
Look at the support page – the link is just below the lecture. It should help you.
if your mobile does not support MP4 playback or Flash.. then you can’t access them.. install flash player..
Dear Sir,
I often seek your help with regards to the comments replies. I have a complex problem that you are only the one to solve:
I am doing part-time business( my father is not financially supporting me, so I am in pressure of work and money), However the main problem is that I just could not practice any thing for f4, f5. I take your lectures but all seem to wash off from my mind, due to not prating question, because of very scarce time that I get.
Kindly provide me tips for daily studies and how to study part-time. Kindly also let me know the enough daily practice, I mean how many questions should I do from KIT? My standard plan was to take lectures, study text book and then practice questions. All I am now stuck is at the process of receiving lectures till the maximum text, I cant go ahead of this process due to short time.
Please solve my problem.
Many Thanks
It is difficult to add to what I replied to you before. Remember that most of the people taking the exams are working fulltime and have to study in the evenings and weekends – at least you have more time because you are working part time.
What you should do is listen to the lectures (and have the course notes in front of you at the same time).
When you feel confident in the topics then you should practice questions from the revision kit.
If there are topics where you feel that you do not really understand, then you should look at the study text – use it as a reference book rather than trying to learn everything in it.
ok….thank you
The advertisement block is covering the download button….pleassssseeeeeeee,heeeeeelllllllppppp…thank you
There is no download button!
Lectures can only be watched on line. You can download the course notes, but not lectures.
Hello
Great Lecture!
I was just wondering if you could clarify something for me? I understand that the main concept of throughput accounting is that, in the short run, all costs in the factory are likely to be fixed with the exception of material costs. However, after watching your lecture and working through example 2 I don’t understand why the figure for ‘other variable costs’ was not deducted along with the cost of materials as it states other ‘variable’ costs. Please can you answer this question for me, so I can get my head around it?
Thank you
Charlotte
Normally, we regard materials, direct labour, and variable overheads all as being variable costs.
With throughput accounting, we assume that (in the short-term) the only variable cost is materials and that all others are fixed. So……labour and variable overheads (i.e. other variable costs) are assumed to be fixed.
Ok. Thank you for getting back to me so quickly.
Ill just make a note that the only variable cost short term is materials!
Thank you
Charlotte
Thanks openTuition …really a grt job
Thank you Open tuition!
Best!!
Excellent!!
very good lecture
its amazing how easy you make this topics, thank you so much
Hi, Can i download the lectures to watch later?
No, you can only watch on line –
this lecture is not going anywhere, you can watch it later
Fantastic lecture. Very clear and logical approach. I’ve understood this 100% and only needed to watch a single lecture once. John Moffat, I honestly think you are the best lecturer I’ve witnessed!
Thanks to all the people who have made OpenTuition possible!
Thank you
Thank you very much! I had missed the lectures of throughput accounting in college, n as a revision tests schedule was being planned, i realized that i need to get hold of dis topic as quick as i can! i must say that i had not expected a lecture like this! this is awesome! the best place for revisions, any thing that i have missed, and it certainly is the best guide for students who are studying on self study basis! once again: Thank u for the this great free lecture, m delighted! i will certainly be coming back to this site for sure! i do not know you sir, but i hope that u continue this great work!
Nice lecture!!! Thanks a lot sir……
Extremely helpful…Big Up!
Thank you So much Extremely Easy to Understand
It is very good lecture I hope it be usefull for all students, please every one give me advise I NEW ACCA STUDENT
best wishes to all acca students
What sort of advice are you wanting?
Really helpful lecture but I have got a doubt about the example #1.
Is it not easier to calculate the max profit using the conventional key analysis as 19000( units of A produced ) * $2 ( profit per unit) + 10000 ( units of B produced ) * $2 = $ 38000 + $ 20000 = $ 58000 ?
What I don’t understand is why we need to make that assumption if we got the profit per unit.
thanks
Well…that would give the wrong total profit
The reason is that regardless of how we choose to absorb the fixed overheads, the total fixed overheads are (by definition) fixed, in that the total will not change with the level of production.
Because we are looking at having to change the production quantities we must work on contribution. Once we have the total contribution we can then subtract the total fixed overheads to get the profit..
Very helpful….Thank you so much Sir…
Thank you
Great!!!
encouraged by these posts and lectures. Thank God for OT
My teacher considered contribution/ unit of the limiting factor.. Which approach is right/better? Thanks!
got the answer..
Great
Thanks for quick reply.
Many thanks…..your help is much appreciated!!
You are welcome
The video does not load at all!
but it says “404 NOT FOUND”
Please help!!
all you gonna do is just refresh your browser. =)
Could you kindly lecture on Environmental Accounting and Life cycle costing please?
Even just the small lecture will do, but it will make easier to understand the topic.
Many thanks..Great job!!
I will record a lecture on life-cycle costing when I have the time.
However there will not be a lecture on environmental accounting for the reasons stated on the index page to the lectures (it would only effectively be reading out the course notes since there can not be any calculations asked!).
I wish I knew about Open Tuition sooner, I only have 2 days before the exam. Still hoping the best.
@trini83, Good luck, and remember us for your next set of exams
@trini83, Sigh you are not alone.
Macoya centre.
Good Luck!
Thank you.
Macoya Centre, as in “Centre of Excellence”?
@trini83, Good luck!
Certain things come up more frequently than others. Out of all the past papers I have done there are certain chapters I would focus on at this late stage.
Chapter 1 (Activity Based Costing) – 74 minutes for the three lectures.
Chapter 8 (CVP) – 69 minutes.
Chapter 13 (Standard costing and basic variance) – 103 minutes.
Chapter 14 (More variances) – 121 minutes.
Chapter 15 (Financial performance measurement) – 49 minutes.
Chapter 16 (Non financial performance measures) – 26 minutes.
That should be the best bunch of lectures to watch, download and print the notes and follow through the examples. You can skip what you are already confident with!
After that, though I doubt you’ll have time… Chapters 11 and 7 are good all-round chapters for provoking your thought processes in terms of exams.
You can fast-forward through bits of the lectures too. Make sure to take breaks after every chapter, and get a good sleep!
Good luck again!
Excellent Lecture!!!
I went through the whole book but just realised I didn’t see all of your lectures. I have just now started finally feeling confident thanks to your great help.
thank you again!
thanks a lot .
how can i get to listen to the lecture?
@jiangsxjiangsx, lecture play fine, use modern browser – and do not use any download managers. they corrupt the video stream
why cant i listen to the lecture?whats mean of “the materials are removed”?
very very helpul lecture
short and to the point 
thanks alotttt
Is it possible to download lectures? It will help students like me to study offline with these video lectures who has no internet or slow internet.
No, lectures are on line only, that’s the only way to keep this site free and on line.
for offline use – buy a study text
Very good lecture , infromative
Excellent Lecture
Thanks a lot
its really helpful
I was somewhat lost with this topic but since I watched this lecture I actually understand. Thanks a million
Hi there,
I’ve recently started going on here and watching the lectures and I’ve found them very helpful. Thans a million for that.
I would like to knnow though are these lectures enough to get fully prepared for f5 exam or do I have to read the study book as well? I’ve started studying syllabus few days ago and I’m a bit concerned that I won’t have enough time to get ready for the December’s session, since I wanna do f4, f5 and f6…
Thanks
Atty
@atanaska, hi there
even im attempting F5 this time around. it is said that f5 course is pretty lengthy but trust me its not. the calculations are piece of cake and it’ll take u no time to get a hold of them. secondly, the theory part is a bit tricky but in time you’ll perfect it.
3 months are more than enough for f4 ,5 & 6.
This stuff is really GOOD !
Very helpful! Thanks a lot!
i am hearing but can’t view
Thank you so much. I have started watching the lectures 2 weeks ago and now I am hooked. No gaps no second guessing, It is so much faster to learn than when actually reading study texts.
very helpful.
thank you.
@henahailu2, Hi there Hailu sounds familiar .Are you from Et? If you are you know what Et stands for. If you are not sorry for the confusion I may have caused.
OT is really helpful .They make the course sound intresting.
Good Luck on your Exams!
trying to open the link in the site but it keeps giving the following error : Video not found. I could watch the other without any problem. Please assist.
thanks
@marlise123, Try to log out and log in or try different broweser. It works fine for me.
Good Luck!
@Et, nope i logged out and still cant open it. How do i open it in a different browser?
AAAAARRRGGGHHH!!! sobbing!! :’ /
@marlise123, I can understand your frustration. I use Mozilla Firefox and it is working. Try it with Mozilla or Google Chrome. As I am typing this the video is still running . It was a bit slow earlier when I was trying to open The costing chapter 13. I gave it a few mnts and tried it again and it worked.
these chapters is not working on my ipad. please let me know how i can view the class.
thank
not all F5 lectures are supported to work on the iPad at the moment
Thanks a lot, now it clear!!
This lecturer is really great!! So simple explanations and straight to the point with real examples… everything makes perfect sense to me… Thank you
better than my lecturer.
@admin
Video is not playing,
It gives the error that “Video not found”.
Please fix it..
gud 1 sir,cn plz lecture on chapter 3 also.a small request.
excellent lecture sir:
this teacher is very helping and the sound is very good and very clear. if he give all the lectures in full detail like this will be excellent effort by open tution.
wonderful!!!!!
wow fantastic lecture,thanks for he post…………
excellent
Soooo nice
Thank you !!!!!!!!!!!!! So clear and straightforward, excellent lecture not to be missed. The revision of assumed knowledge was very helpful.
great lecture
Excellent !!