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Ratios – Chap 24 – Example 2 Sample Questions

Forums › Ask CIMA Tutor Forums › Ask CIMA F2 Tutor Forums › Ratios – Chap 24 – Example 2 Sample Questions

  • This topic has 1 reply, 2 voices, and was last updated 7 years ago by P2-D2.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • October 5, 2017 at 9:56 pm #409600
    Harry
    Participant
    • Topics: 8
    • Replies: 22
    • ☆

    Hi Chris
    I don’t see the lecture video for AB and CD question. Please refer me to relevant video if provided.

    Q) asked for following statements, therefore my understanding of the requirement was it could be more than 1.

    Therefore I selected, 1 and 5.

    1) AB operating expenses < CD therefore does exercise greater control in o/h (AB = 13.2m and CD = 33.6m)

    5) CD management has sourced cheaper materials for resale – CD COS are less than AB therefore this suggests that materials were cheaper than that of AB

    If the question requested for 1 statement (like it does in Kaplan revision kit) then I would select 1.

    I hope I have explained myself clearly and thank you in advance.

    October 11, 2017 at 10:42 am #410329
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 7177
    • ☆☆☆☆☆

    Hi,

    Could it not be that the gross margin is less in AB because it sells the goods cheaper than CD and therefore has the lower margins?

    Thanks

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