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I also got caught up on this question.
I thought upon death you only deduct from the NRB what was used in from the band in the previous 7 years before the gift, but this question also deducts the annual exemptions to arrive at 296,000.
Check the electric range table in the rates pages for electric range of 52 miles.
Oh ok that clears it up! I was thinking only operational are controllable.
But when we speak of planning variances and uncontrollability- we are usually talking about it from the point of view of operational managers.
Sorry I didnt see your previous reply. No it from the Kaplan textbook that discusses the advantages and disadvantages of undertaking operating and planning variances analysis.
One of the problems of planning and operational variances is
‘There can be a conflict between operating and planning staff, each laying the blame at each other’
I thought planning variance was not uncontrollable. Who is the planning staff? 🙂
Sorry I still dont understand what ‘ex-post’ is and why its difficult.
Does this point just mean that if there is an adverse variance between the original budget and actual results, managers will try and blame the original budget being subjective and therefore try and shift blame?
But this method is specifically for maximizing contribution, the question only asks to breakeven. How would we know which method to choose.
The question was: What is the minimum revenue required for production to break even?
1- When dealing with quarters, dont we find the average of the 4 numbers of the year?
2- The figures given are not actuals but averages already calculated, so why are we calculating an average again?Thank you for the advice! Didn’t even notice the word ‘closing’ in the question. :S Will look out for the key words.
Ah ok! That makes sense.
So if Incremental is suitable for stable environments and rolling for dynamic markets, is there a specific setting sutiable for ZBB or would it just be suitable for certain cost planning within a budget?
Thank you- its clearer now! I just get bogged down when I make calculation mistakes! Just typed out a whole question on what I was doing wrong- just to solve it correctly while I was typing 🙂
Thank you!
Ok I understand- its basically the opposite of the whole demotivation issue when held responsible for uncontrollables!
Thank you!
So ‘poor planning’ is not referencing planning variances, which are out of the control of managers?
I also have another question:
To calculate material yield which of the following is used:
1- Actual quantity of materials at STD PRICE
2- Actual quantity of materials at standard price
3- Actual yield at standard materials cost.
4- Standard yield from actual input of materials at standard cost.What is the difference between the terms Actual Quantity and Actual Yield?
Thank you
Hi,
I was also stuck on the above question. However based on the answer in the book, I am unsure how a standard yield of 1,531.25 was calculated.
Thank you for the reply. I understand the concept but I dont understand why
”This formula only works for total cashflows- It cannot be used for individual units, selling prices, variable cost per unit”
Can we not say say if sales units fell by a certain percentage, it will affect a decision
Or if variable cost increases by a certain percentage, this will cause profits to be lower affecting a decision about a possible project?
Thank you once again for taking the time out to answer my questions. The support is much appreciated!!
I just passed with 91% 🙂
Hi sm8980!
Unfortunately I already sat the FA paper last month, but good luck on your upcoming exam!