Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › section c

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- June 22, 2021 at 7:38 pm #626118
noble (6/11)

For part a) of this question, how to calculate the staff wages costs.

At the back of the book, when calculating the overtime, 8 staff has been multiplied by 1.5 hours instead of 6.5 hours. I do not understand why this is so whilst the hours per day is 6.

The calculation that I performed for staff wages costs is 6 X 4 X 6 X 8 X 8 + (1560 – 50 X 6 X 4)/5 X 1.5 X 8 X 12. I don’t understand where I went wrong in my calculation.

Also, how to calculate the energy costs.

For part a), it is mentioned that the standard mix of customers remains the same as budgeted. What does it mean and what implications does it have particularly when preparing the flexed budget.

June 23, 2021 at 8:01 am #626131The average number of orders per day is 65.

Notes 5 of the question says that for every increase of 5 orders above 50, the have to work 0.5 hours of overtime for which they are paid $12 per hour. Since 65 orders is 15 more than 50 orders, then each member of staff has to work 15/5 x 0.5 = 1.5 hours of overtime.

So each member of staff is being paid for 6 hours at $8 per hour, and 1.5 hours at $12 per hour.

The energy costs are the total number of hours worked multiplied by $2.94 per hour.

Standard mix means the same as it did when you were studying mix and yield variances. (I assume that you studied the syllabus before starting on questions in the Revision Kit?) Note 2 says that the budget is based on 50% of customers ordering each of the two meals. If we assume that the standard mix stays the same, then the flexed budget assumes that 50% of the customers order each of the two meals.

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