• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Ask AI
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

June 2025 ACCA Exams

How was your exam? Comments & Instant poll >>

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for September 2025 exams.
Get your discount code >>

KAPLAN question

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › KAPLAN question

  • This topic has 3 replies, 2 voices, and was last updated 2 years ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • July 9, 2022 at 12:24 pm #660210
    thewdr
    Participant
    • Topics: 3
    • Replies: 4
    • ☆

    The predicted selling price for a product has been set at $56 per unit. The desired mark-up on cost is 25% and the material costs is estimated to be $16 before allowing for additional materials to allow for shrinkage of 20%( for every 10kg material input only 8 kg comes out)

    If labour is the only other cost and 2 hrs are needed, what is the most the business can pay per hour if the cost gap is to be avoided?

    Answer: Sales 56
    Profit 11.2
    Target Cost 44.8
    Materials (20)
    Labor-2 hrs 24.8

    For 1 labor hr 12.4.

    Sir could you explain how we get 20 for materials?

    July 9, 2022 at 5:53 pm #660215
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54680
    • ☆☆☆☆☆

    For every 10kg that they buy, only 8kg are available to use in the product (because of the shrinkage).

    Putting it the other way round, for every 8kg that they use in the product, they need to buy 10kg.

    Therefore if they use $16 in the product for 8kg (which is $2 per kg) they actually need to buy 10kg and will therefore spend 10/8 x $16 (or 10kg x $2) which is $20,

    July 10, 2022 at 2:34 am #660224
    thewdr
    Participant
    • Topics: 3
    • Replies: 4
    • ☆

    Got it. Thank You sir ?

    July 10, 2022 at 8:10 am #660228
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54680
    • ☆☆☆☆☆

    You are welcome.

  • Author
    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘KAPLAN question’ is closed to new replies.

Primary Sidebar

Donate
If you have benefited from our materials, please donate

ACCA News:

ACCA My Exam Performance for non-variant

Applied Skills exams is available NOW

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

ACCA CBE 2025 Exams

How was your exam, and what was the exam result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Donate

If you have benefited from OpenTuition please donate.

PQ Magazine

Latest Comments

  • wZaidhan on Sources of Finance – Islamic Finance – ACCA Financial Management (FM)
  • manahylilyas on The financial management environment – ACCA Financial Management (FM)
  • poojam on Objective of financial reporting – ACCA Financial Reporting (FR)
  • mm3677 on IAS 16 Accounting for a revaluation – CIMA F1 Financial Reporting
  • Anastesia123 on MA Chapter 1 Questions Accounting for Management

Copyright © 2025 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in