• 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

20% off ACCA & CIMA Books

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

September/December 2017 question number 32

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › September/December 2017 question number 32

  • This topic has 1 reply, 2 voices, and was last updated 5 years ago by John Moffat.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • February 3, 2020 at 11:27 am #560503
    kennigara
    Participant
    • Topics: 193
    • Replies: 250
    • ☆☆☆

    Hi Dear Tutor, I have another question.

    Note 1 says that 30% of depreciation relates to assets controlled but not owned by head office.

    Division C ( for understanding I just take one of them)
    Fixed cost 945000 include 165000 let us assume

    Fixed cost without depreciation is 945000-165000=780000

    30% of 1650000=49500
    70% of 165000=115500

    the question says head office has little intervention on both divisions.

    if 70% of depreciation belongs to head office and 30% is controlled by the division why do I deduct 30%of depreciation?Iif we deduct 30% of depreciation this means that head office more intervention over both divisions.

    So confusing

    could you explain it please?

    External sales————-X
    internal sales————-X
    total sales—————–X
    fixed cost—————–(x)————-controllable
    variable cost————-(x)————–controllable
    controllable profit——–x
    fixed cost—————–(x)—————non-controllable
    variable cost————-(x)—————-non-controllable
    traceable profit———-(x)
    head office cost———(x)
    residual profi————–x

    February 3, 2020 at 2:18 pm #560515
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54699
    • ☆☆☆☆☆

    You can deduct the 30% depreciation from the fixed costs if you want (although it is rather wasting time) and you will get the same answer. We would do it because the 30% expense is not controllable by the division and we want the profit controllable by the division.

    More sensible and faster is to do as in the examiners answer. The profits given in the question will be after charging the full depreciation. To get the profit that is controllable by the division, we add back the 30% because that part of the depreciation expense is controlled by the head office.

  • Author
    Posts
Viewing 2 posts - 1 through 2 (of 2 total)
  • You must be logged in to reply to this topic.
Log In

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

  • mrjonbain on ACCA BT Chapter 6 – Some legal obligations – Questions
  • Ken Garrett on ACCA BT Chapter 6 – Some legal obligations – Questions
  • Ken Garrett on The nature and structure of organisations – ACCA Paper BT
  • OmarAlbeity on ACCA BT Chapter 6 – Some legal obligations – Questions
  • Salimbek909 on The nature and structure of organisations – ACCA Paper BT

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