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August 5, 2022 at 5:04 pm
Is there any difference between semi-variable costs and semi variable/fixed cost?
John Moffat says
August 5, 2022 at 7:10 pm
They both mean the same.
August 5, 2022 at 5:00 pm
In example 6, total costs for 2 different levels of output are given. and as you explained in the lecture the total costs given are the semi variable costs. does it mean that the total cost consists of only one semi variable cost like electricity for factory(which includes electricity to power the machines and electricity to light the factory) or is it that the total cost can include both fixed and variable costs like rent of the factory, electricity to power the machines and therefore the total cost is being called a semi variable cost?
August 5, 2022 at 7:11 pm
It means that part of the cost is fixed and part is variable (there might be several fixed costs and several variable costs).
August 5, 2022 at 3:25 pm
why is it because of the “linear assumption” that all costs can be categorized as either fixed or variable?
August 5, 2022 at 7:12 pm
It is not because of the linear assumption. It is simply that in Paper MA calculations we assume that the variable costs are linear.
September 11, 2020 at 5:20 am
Another feedback I would add would be that you could have explained in regards to the fixed cost per unit graph, that how much ever unit we increased and the fixed cost thus reduced per unit, – there would always remain a fixed cost – how much ever small – it would never reach zero. And that is why the graph , although curving downwards, never reaches zero.
I really like to once again appreciate your amazing skills of making difficult sums and explanations sound from complicated and confusing to logical and simple ! Greatly appreciate your amazing project. Helps seekers of knowledge many folds. You are appreciated.
September 11, 2020 at 11:37 am
That is of no relevance for the exam 🙂
September 11, 2020 at 4:55 am
Hello good sir,
You make complicated problems seem so logical and thus turn them simple. Hats off to you, good sir.
Although, this chapter in my local tutor’s provided notebook, also covered standard deviation and other such formula related calculation problems. I see it excluded in your current cost behavior lecture. I hope you do cover them somewhere later on.
Again, grateful for your generous services ! May God grant you your return.
September 11, 2020 at 11:38 am
You have asked elsewhere the same question and I have answered it. Standard deviation etc are covered later in our notes and lectures and have nothing to do with cost behaviour.
May 29, 2020 at 9:39 pm
I encountered a problem when using ask forum can you help please
May 29, 2020 at 2:01 pm
Regarding the HIgh – Low method Would it be okay if we mix up two different outputs for calculating the variable cost?
May 29, 2020 at 3:00 pm
Yes, but only if the relationship is perfectly linear i.e. that the variable cost per unit stays the same. In theory it should stay the same but in practice it might not.
February 29, 2020 at 2:47 am
Hi, I have been studying this topic and have come across a question using high low method with stepped fixed cost.
Question: An organisation has the total cost at three activity levels. Activity levels (units) 4000, 6000, 7500. Total costs $40800, $50,000 and $54800 respectively. Variable cost per.unit is within this activity range and there is a step up of 10% in the total fixed costs when the activity level exceeds 5,500 units. What is the total cost at an activity level of 5000 units?
Solution VC /unit = [(54800-50000)/(7500-6000)]= $3.2
Total FC above 5500 units= (54800-(7500*3.2)=$30800
This part I totally understand.
What I don’t understand is how the total FC below 5500 units.
As per solution Total FC below 5500= 30800/110*100= $28000
Where did it get the 110 and why multiply by 100??
Thanks and regards
February 29, 2020 at 10:29 am
Please ask this kind of question in the Ask the Tutor Forum and not as a comment on a lecture.
February 24, 2020 at 7:45 am
u r a fantastic lecturer !
February 18, 2020 at 4:43 pm
Sir I have a question the fixed variable cost how does it apply these days that we have metered electricity bill? Because one can use two meters one for production machines the for lightening.
February 19, 2020 at 8:44 am
The fact they are metered is of no relevance. The lighting cost and the heating cost would be dealt with separately.
February 6, 2020 at 3:06 pm
Hi, Your lectures are top quality, thank you so much. Can I just confirm this is for (RFQ Level 4) exams? I’ve already completed the introductory and intermediate level ( RQF Level 2 &3) with ACCA-X and I just wanted to make sure this is for level 4 exams as the lesson feels similar to the intermediate level. cheers
February 9, 2020 at 2:57 pm
Hi, Yes this is for Level 4 FMA
February 12, 2020 at 12:24 pm
corymason98, Thank you for the clarification, much appreciated.
January 29, 2020 at 6:36 pm
Thank you very much!!!
August 30, 2019 at 4:21 pm
thanks for the video, great explanation.
August 31, 2019 at 8:37 am
Thank you for your comment 🙂
June 24, 2019 at 11:24 am
great lecture 🙂
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