Sir Please i want to know when calculating BEP in revenue under multi product, is it always fixed costs divided by C/S Ratio. I’m asking this because when i watched your lectures on CVP Analysis on single product, when finding for the BEP in value, u divided fixed cost by contribution per unit and multiplied the answer by the selling price per unit. i want to know for the BEP in value weighted average is it always fixed costs divided by C/S Ratio.

Hi Thank for this wonderful revision. I wanted to ask, on my calculations I did everything the same as you did except when I left the answer as 0.61 instead of 60.92%

As a result, my answer for question B is then actually 1577508.20 because of the rounding off. In the CBE exam, does this mean I will not actually get the full marks although I did all the calculations and formulas correctly?

Contribution is defined as the profit before any fixed costs (i.e. revenue less variable costs)!

Have you watched my free lectures on CVP analysis? The lectures are a complete free course for Paper F5 and cover everything needed to be able to pass the exam well.

Yes this is my mistake. Thank you for your prompt reply. I have watched all your lecture F5 and now I practice more by myself. I still have problem to understand and remember variance

Thanks John for the brilliant lectures . sir ,are we suppose to graph the total cost with the Y axis or the X axis since the Y axis depicts revenue and cost and the X axis depicts the sale unit pls. kindly explain

The x- axis should the units, and the y-axis shows both the revenue and the total costs.

(You can no longer be asked to draw any graphs in the exam, but there could be a graph given in the question and you are expected to be able to interpret it)

adukwaku1 says

Sir Please i want to know when calculating BEP in revenue under multi product, is it always fixed costs divided by C/S Ratio. I’m asking this because when i watched your lectures on CVP Analysis on single product, when finding for the BEP in value, u divided fixed cost by contribution per unit and multiplied the answer by the selling price per unit. i want to know for the BEP in value weighted average is it always fixed costs divided by C/S Ratio.

John Moffat says

Dividing by the contribution and multiplying by the selling price is the same as dividing by the CS ratio.

kish200 says

Hi

Thank for this wonderful revision.

I wanted to ask, on my calculations I did everything the same as you did except when I left the answer as 0.61 instead of 60.92%

As a result, my answer for question B is then actually 1577508.20 because of the rounding off.

In the CBE exam, does this mean I will not actually get the full marks although I did all the calculations and formulas correctly?

John Moffat says

You would still get full marks unless the question specifically said what rounding to use.

meslyn says

Thank you John,

Instead of using the cost per unit and the selling price per unit, i used the total cost and total revenue and had the same answer. Am i correct?

John Moffat says

Yes – no problem 馃檪

jeremy1469 says

Hey John, for part A i did not multiply the number of units but managed to get the same contribution to sales ratio.

W.A.C = 972+1084+869

S.P per unit = 1600+1800+1400

= 2925/4800

= 0.61 = 61%.

Would this be wrong? Thanks ahead!

John Moffat says

That is fine – it gives the same answer!

thanhhuyen says

Dear sir,

Why we don’t minus fixed cost of 55,000 in calculation of contribution (a)?

John Moffat says

Contribution is defined as the profit before any fixed costs (i.e. revenue less variable costs)!

Have you watched my free lectures on CVP analysis? The lectures are a complete free course for Paper F5 and cover everything needed to be able to pass the exam well.

thanhhuyen says

Yes this is my mistake. Thank you for your prompt reply. I have watched all your lecture F5 and now I practice more by myself. I still have problem to understand and remember variance

John Moffat says

You are welcome 馃檪

osuja says

Thanks John for the brilliant lectures .

sir ,are we suppose to graph the total cost with the Y axis or the X axis

since the Y axis depicts revenue and cost and the X axis depicts the sale unit

pls. kindly explain

Thanks

John Moffat says

I don’t understand what you are asking.

The x- axis should the units, and the y-axis shows both the revenue and the total costs.

(You can no longer be asked to draw any graphs in the exam, but there could be a graph given in the question and you are expected to be able to interpret it)