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Hi sir, this is resolved from your answer here: https://opentuition.com/topic/standard-costing-69/#google_vignette
I was confused a very basic concept, I thought that direct labour is always a variable cost and did not calculate cost per unit at all. All good now, thanks!
Ah I see, yes indeed I have but I’ve come back from holiday and I seemed to have forgotten some important concept.. Appreciate your reply! Thank you.
To me, answer should have been
Cost per expected unit = ($22,500 + $2,100 + $840) / 13500 = $1.88444444
Normal loss: 1500kg x 0.56 = $840
Abnormal loss: 500kg x 1.88444444 = $942BPP answer is Normal loss: $840, Abnormal loss: $880.
If I did something wrong, please correct me. Thank you.
Thanks for the reply, sir.
I see, then for MA exam, can I consider those three terms meaning the same thing? I’m asking this as some of the BPP questions treat those three terms as same, for example,
17.10 answer referred ROI = (Profit/capital employed) x 100%
whereas according to the OpeuTuition lecture, ROI = (Profit/*net assets*) x 100%I’ve encountered a few of these examples which confused me a lot, and came up with “Total long term capital = capital employed = net assets”, following BPP MA answers.
Would this be a problem if I apply this logic ONLY for the MA exam?
Thanks!
Hi sir,
Yes absolutely, I always go through your lecture first, practice by myself and move on to the BPP Revision kit.
Ok, we have to use actual purchases and compare the actual cost with the standard cost, which means that we should set the material for 12,000 kg and compare the cost in this case.
Thank you so much.
I got the Usage part by going through “https://opentuition.com/topic/basic-variance-analysis-section/”. Just Material price explanation would be great, thank you!
So both of those are OK to ignore, right? Thank you so much for confirming sir!
Hi, thanks for the reply.
The ones I have spotted on so far are 6.9 (mentioning of WIP in the Material Stores Control Account) and 10.4 (Opening WIP in the example).
It’d be great if you can confirm, thanks!
I see, I guess I should focus on “the number of firms (suppliers, competitors)” when it comes to distinguish these two. Thank you so much for the prompt and clear explanation!