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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › BPP practice and revision kit – Cardio Co
Hello sir,
I am struggling with one of the questions for cardio Co;
Cardio Co manufactures three types of fitness equipment: treadmills (T), cross trainers (C) and rowing machines (R). The budgeted sales prices and volumes for the next year are as follows:
T C R
Selling price $1,600 $1,800 $1,400
Units 420 400 380
The standard cost card for each product is shown below.
T C R
$ $ $
Material 430 500 360
Labour 220 240 190
Variable overheads 110 120 95
Labour costs are 60% fixed and 40% variable. General fixed overheads excluding any fixed labour costs are expected to be $55,000 for the next year.
Required:
(a) Calculate the weighted average contribution to sales ratio for Cardio Co. (4 marks)
I put the answer as 0.6091, as I thought this is how weighted C/S ratios are usually presented but the answer was as a % I.e 60.92%. Can you please advise why it is a % and not as a decimal.
Thank you in advance.
The weighted average C/S ratio can be 0.609 or 60.9%
Both are correct
