Skip to content
Sign inRegister

PM

Financial Performance Measurement - ACCA Performance Management (PM)

VIVA Subject Guide
YouTube video

31 Comments

  1. A-R
    Hi John,
    are we expected to know about the operating gearing ratio formula as well or just the gearing formula you mentioned in the lecture and notes?
    Thank you.
  2. Bright
    Sir please are the formulas given during the exams
  3. noob
    2006 closing inv is the opening inv of 2007
    2007 closing inventory given
    Cos given
    We can find purchases?
  4. John MoffatTutor
    True. But we cannot find them for both years and when comparing we need to compare the same thing.
  5. noob
    Thank you
  6. Sulayman
    Hi Sir, just a quick question wouldn't we know the Purchases if we do Cost of sales + Closing Inventory ?

    Therefore,

    653 / (5385+1006) * 365 days = 37 days ???

    Please enlighten me
    Thanking you in advance.
  7. Sulayman
    I'm sorry I meant:

    653 / (5385+1006 - 871) * 365 days = 43 days

    516 / (4212+871 - 0) * 365 days = 37 days

    Thank you.
  8. John MoffatTutor
    What about the opening inventory? (and it would need to be the same workings for both years for them to be comparable).
  9. Asif
    Greetings.

    What about the operational gearing ratio ?
    Is that not in the syllabus?
  10. John MoffatTutor
    It is not mentioned in the syllabus. It is examined in Paper FM and there are free Paper FM lectures on it.
  11. janetm
    Thank you Sir with the lecture its so helpful.
  12. John MoffatTutor
    Thank you for your comment :-)
  13. zinthambo
    Thank you so much for these teachings. I really appreciate how you simply explain these topics and help us see the logic and common sense :-) behind it. I am writing in December and feel a lot more ready as I watch these videos!
  14. John MoffatTutor
    Thank you for your comment :-)
  15. Mingyu
    Could you please tell me why we use the number of cost of sales as purchase instead of subtracting the sum of last year’s ending inventory and cost of sales by this year’s ending inventory?
  16. lovinsa
    i meant in the exams are given the formulaes
  17. John MoffatTutor
    No - you have to learn them. The formula sheet that you are given in the exam is printed at the beginning of our free lecture notes.
  18. tpile
    sir, why is that you're calculating net profit margin with PBIT instead of using net profit
  19. tpile
    Also in ROCE why we can't use net profit instead of PBIT.

    In receivables days and payables days why we're not taking avg trade receivables and avg trade payables ?
  20. John MoffatTutor
    As I explain in the lecture, it would be better to use average payables and receivables. However the problem is that we then need both the opening and closing balances. We may have both for one year but if we are comparing this year and last year then we need both balances for both years otherwise it is not a fair comparison.
  21. tpile
    Thankyou sir
  22. John MoffatTutor
    You are welcome :-)
  23. John MoffatTutor
    Because we are measuring how well the business is performing. Tax and interest are not under the control of the managers running the business.
  24. tpile
    Thankyou sir
  25. John MoffatTutor
    It depends on what information is given in the question as to whether to use average receivables or closing receivables (although if the information is available then average receivables is better).

    And yes, opening receivables for 2007 will be the closing receivables for 2006.
  26. priscilla5236517
    Thank you so much sir for every lecture video..am so grateful.God bless you.
  27. John MoffatTutor
    Thank you for your comment :-)
  28. Avery
    Sir,
    In example 1, if reserves were given, we would have to take into consideration while calculating the total long term capital correct?

    Thank you
  29. John MoffatTutor
    Correct.
  30. addisanopacourage
    Thanks John
  31. John MoffatTutor
    You are welcome :-)

Leave a comment