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Please , is anyone using Kaplan exam kit? I think there is an error in the question concerned in the subject of this post.
Namely, there is something wrong with calculation of operational gearing- question states Fixed costs constitute 15% of total Cost of sales. It gives for the current period 4500 , however when you check the answer you will notice Operational gearing (fixed costs/total costs) is measured as 18500/44000 -> where did 18500 come from?? 4500 is 15% of total cost of sales of 30,000
would be grateful if anyone could shed some light on this. It’s really frustrating you get stuck on a stupid thing like this, – I have also noticed there are some errors in this kit in relation to formulae.
thanks
MHi M,
I totally agree with you that the figure should have an explanation in the answer part.
18,500 consists of the fixed cost calculated as 4,500 +/and 14,000 administration cost (it is also fixed cost).
Hope it is clear now.
By the way in the same question when calculating operational gearing using fixed costs/variable costs don’t be shocked as there are some calculation errors 😀
Warm regards,
Tammi- Topics: 7
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Hi Tammi,
many thanks for replying – what is your opinion on Kaplan exam kit anyway? I think there is too many errors, also in the formulae somewhere…M
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