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Financial Performance Essay

650 words - 3 pages

*
* AAT LEVEL 4

Diploma in accounting
Financial performance (FPFM)
Assignment 1
*

*
FPFM Assignment 1
* Task 1
* The total costs of a business, which are semi-variable, at two levels of output are shown below:
| 20,000 units£ | 25,000 units£ |
Total cost | 135,000 | 177,500 |
* The fixed element of the cost steps up by £25,000 at an output level of 23,000 units.
* The variable cost per unit is £
.
* The fixed cost before the ‘step’ is £
.
* The fixed cost after the ‘step’ is £
.
* Task 2
* A business has prepared two sets of budgeted costs at ...view middle of the document...

* The total cost of making one unit is £
.

* Task 5
* A business produces a product that has the following standard cost card:
| £ |
Variable production costs | 12.00 |
Fixed production overhead | -------------------------------------------------
8.00 |
| -------------------------------------------------
20.00 |
* There are also variable selling costs of £2.50 per unit and fixed selling costs of £15,000. The selling price of the product is £27.
* The fixed production overhead has been calculated on the basis of budgeted production of 10,000 units. The actual fixed production overhead cost was £90,000.
* Actual production and sales volumes were as follows:
| Units |
Production | 12,000 |
Sales | 11,500 |
*
There was opening inventory of 1,000 units at the start of the period.
* Calculate the profit for the period for the business using absorption costing.
| £ | £ |
* Sales | | |
* Less | * Cost of sales | | |
* | * Opening inventory | | |
* | * Variable production costs | | |
* | * Absorbed fixed production costs | | |
* | * Less closing inventory | | |
* | * Cost of sales | | |
* Over/under absorption adjustment | | |
* Gross profit | | |
* Less | * Variable selling costs | | |
* | * Fixed selling costs | | |
* Net profit | | |
*
* Task 6
* A business produces a product that has the...

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