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Incremental cost

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Incremental cost

  • This topic has 1 reply, 2 voices, and was last updated 8 years ago by John Moffat.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • March 6, 2017 at 4:47 am #375811
    stepstothebest
    Member
    • Topics: 62
    • Replies: 15
    • ☆☆

    Dear respectful professor;)

    Hello

    The question is like it has been agreed to pay time and a half to sale assistants work on sunday. The normal hourly rate is $20 per hour. In total five sales assistants will be needed foe the six hours that the store will be open on a sunday. They will also be able to take a half day off (foue hours) during the week. Staffing levels will be allowed to reduce slightly during the weel to avoid extra costs being incurred.

    In this question, i thought i should consider the half day off during the week as well. But in the answer sheet
    Just written like 5 sales assistants ×6 hours × 50 weeks ×1.5 ×20= 45000.
    The answer sheet doesn’t inculde the half day off….
    Could u possibly explain to me why it doesn’t include the half day off?

    Regard your student Hong

    March 6, 2017 at 7:12 am #375843
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54655
    • ☆☆☆☆☆

    The wording of the question is a little confusing (this question was set by the previous examiner).

    However, although they are allowing staff to take 4 hours off (to compensate them for having to work on Sundays) there is no mention of paying them any less (and therefore no saving).
    When the question says staffing levels will be reduced slightly, it does not mean that they will imply fewer people in total – just that because of the half day off there will be slightly fewer staff actually in the store at any one time.

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  • The topic ‘Incremental cost’ is closed to new replies.

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