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Hello John,
I would appreciate your help in the question below.
It is asked for Machine Set-up cost per unit of Product S.There are two products R, S:
Production units: R: 80 000 S: 60 000
Batch size units: R: 100 S: 50
Mach.setup per batch: R: 3 S: 3
Processing time per unit (min) 3 S: 5Annual costs for two activities:
Machine set-up 180 000 USD
Processing 108 000 USDThank you in advance!
This forum is to ask for help on anything that is causing you a problem in our lectures or in our test questions. It is not a place to simply expect an answer to a question you have found somewhere (and for which you presumably have an answer anyway in the same book).
You need to calculate the cost per set-up by dividing the total set-up cost by the total number of set-ups.
Then you can calculate the total set up cost for S and divide by the number of units of S produced in order to get a cost per unit.
Have you watched my free lectures on ABC? Our free lectures are a complete course for Paper F5 and cover everything needed to be able to pass the exam well.
Thank you John a lot! Please apologize, this was the first question raised by myself in the forum.
Yes, I did watch your lectures and I find them amazing! I am big fan of you! IThis question above I found in Becker, and it is pretty similar to the question in the F5 Revision Kit, where it is asked about Open Ltd and set up costs for X.
I understand it and follow the method, unfortunately for this example the answer is 1,8 USD, while I calculated 1,5 USD.I asked it on the other forum, but no response 🙁
They are making 800 (80,000/100) batches of R, and 1,200 (60,000/50) batches of S.
So a total of 2,000 batches.Therefore the set-up cost per batch = $180,000/2,000 = $90.
S has 1,200 batches, so the total set-up cost for S = 1,200 x $90 = $108,000
There are 60,000 units of S.So the set-up cost per unit = 108,000 / 60,000 = $1.80
Dear Sir, please accept my apologies for previous ignorance 🙁
If only I would start with the batches.. Thanks!!!!! For a strange reason I was trying to understand how relevant is the time information….
Again, thank you a lot for your understanding and explanation.
May I ask a 2nd question?
I used the March/June 2016 version of Notes while watching the lectures (I started in May). Would you recommend to print the latest (this is Sept/Dec 16 version now?What I can see from the Syllabus changes on ACCA site, the content wasn`t changed. However the exam format is going to be changed.
I work also with Becker Revision Question Bank.If I am mistaken, could you please advise? thank you in advance:)
There is no need to print out the notes again – any changes are only minor.
The format of the exam will be different, but it does not affect your studying.
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