# Financial performance round 2!

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Hi Everyone,

I've got my FNP resit on wednesday and I'm not feeling confident at all. Looking over cbt 3
& flop, I know how to get contribution per unit just can't seem to figure out this. And also task 2.2 d
the optimal production mix?

Thanks

Aaron
AAT

Level 2 - 2010
Level 3 - 2011
Level 4 - 2013

ACCA

F4 - 2015
F5 - 2015

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Hi,

I also have my exam this Wednesday!

So you got the contribution for Flip which is £12 and Flop which is £15

The material requirements for Flip is 2kg and for Flop it is 3kg so if you divide this:
12/2 = 6 contribution per unit of limiting factor for Flip
15/3 = 5 contribution per unit of limiting factor for Flop

The optimal production mix is 10,000 units for each.

As there is only 50,000 kg available to use, as Flip has has the most contribution per limiting factor this is made first.

In the earlier part of the question you calculated that the material requirements for Flip is 20,000kg and for Flop it is 60,000kg... You first make all of Flip

So for Flip: 10,000 units, 20,000kg material which a contribution of £150,000 (£15x10,000)
for Flop: 10,000 units, 30,000 kg material as the maximum we could use is 50,000kg with a contribution of 360,000 (12x30,000).

The 10,000 units for Flop is calculated like this: because there is a maximum of 50,000kg material Flop can only use 30,000kg so 30,000/3kg(material requirement) will give the units for Flop.

So overall its 10,000 units for each Flip and Flop.

I hope this has helped even though its so much to take in.

• Registered Posts: 422
Thanks for the reply, I'm understanding a lot better now.

Yeah ditto there's so much information to take in and by far the hardest exam of level 4.

Good luck to you also!
AAT

Level 2 - 2010
Level 3 - 2011
Level 4 - 2013

ACCA

F4 - 2015
F5 - 2015
• Registered Posts: 177 🎆 🐘 🎆
I totally agree!

Let me know how you got on.
• Registered Posts: 283
I have my round 2 on Thursday and not feeling confident! :-(
Level 2 - Passed 2011
Level 3 - Passed 2012
Level 4 - Passed 2014

Awaiting to start CIMA
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Hi Sammy

What are you not feeling confident about? Which areas in particular?
• Registered Posts: 165 🎆 🐘 🎆
Hi Guys

Got my second attempt 2moro too, and I am not feeling confident at all. In fact I want to cry and that is no joke:crying:

I have just done CBA 3, and this was very similar to what I had last year!!

Please could anyone help with this question as my mind has gone totally 100% blank at this late hour!!!! GULP

I just dont know how they calculate
1. the expected cost per kilo forr Nov 2 to be £10.30
2. The % increase in th price of TZ from Jan x2 to Aug x2 to be 3.96%

Pullingmyhairout.com :ohmy:

Thanks
• Registered Posts: 422
Hi Jane,

To calculate the expected cost per kilo we have to work backwards so 107.25/100*9.60= 10.296 2.dp 10.30

The percentage increase is calculated by doing the difference/original*100.

So difference is 9.98-9.6= 0.38
Original is 9.60
0.38/9.60*100= 3.9583 rounded to 2dp is 3.96

Hope this helps

Aaron
AAT

Level 2 - 2010
Level 3 - 2011
Level 4 - 2013

ACCA

F4 - 2015
F5 - 2015
• Registered Posts: 782
Hi,

Cost per kilo in Nov 02 is 9.60 x 107.25% = 10.296 rounded up to 10.30.

Percentage increase from Jan to Aug is increase/original price x 100, therefore ((9.98-9.60)/9.60) x 100 = 3.96
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Ah, beaten to it by Aaron, that'll teach me not to refresh my page before answering!
• Registered Posts: 165 🎆 🐘 🎆
:laugh:

Thanks both

Of course it is :ohmy:

Much appreciated, how daft do I feel now cos I knew it really, just couldn't recall it from all the info in my brain!!!!
Panick has started to set in now, but am trying to keep calm!

Good luck for 2moro

Think I am in for a very long night at this rate!!!

J x
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I am struggling to work out variances when they have these cost card thingys *sob*
Level 2 - Passed 2011
Level 3 - Passed 2012
Level 4 - Passed 2014

Awaiting to start CIMA
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Fingers crossed they won't have the cost card things.. I prefer the other layout too.
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Hey guys!!

All the very best with FNPF - dont forget to breathe!!

Please let us know how you get on!!
• Registered Posts: 422
I'm fine with section1, section 2 I'm absolutely dreading really hope I don't get target costing.

Good luck to everyone
AAT

Level 2 - 2010
Level 3 - 2011
Level 4 - 2013

ACCA

F4 - 2015
F5 - 2015
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Hi Aaron

Yes i completely agree with you. I am finding target costing a bit of a nightmare. I have just done CBA 4 and this is the one I had last year for sure. I got stuck with the same bits as I did originally re target costing!! So know where I went wrong now.
Oh boy am I dredding 2moro. I am so shattered. I have put alot of hours into this again, and I think I will just be so depressed if I get a naff paper again.

I actually thought Financial Statements was the worse one, but now feel that they are definately on par with each other. Luckily I passed FS first time. Hopefully I can scrape through this one.
I feel my written technique has improved , but as for the target costing/Limiting factors etc arghhhh :001_tt2:.
• Registered Posts: 422
Evening Jane,

tbh I thought financial statements wasn't that bad, I also passed first time but I feel FNP is harder.
Yeah really hoping I don't get target costing, life cycle costing now that I would love to get in
section 2 :laugh:

You're nearly there don't give up now!
AAT

Level 2 - 2010
Level 3 - 2011
Level 4 - 2013

ACCA

F4 - 2015
F5 - 2015
• Registered Posts: 177 🎆 🐘 🎆
Target costing isnt too bad - you just take the percentage off the selling price. But lifecycle costing would be so much easier!!

Good luck to everyone doing the exam tomorrow and let me know how you get on.
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at least we will all be waiting together!
Level 2 - Passed 2011
Level 3 - Passed 2012
Level 4 - Passed 2014

Awaiting to start CIMA
• Registered Posts: 422
EXAM in under 4 hours if someone could help please very much appreciated!

FNP practise cbt 4 task 2.3 d!!
AAT

Level 2 - 2010
Level 3 - 2011
Level 4 - 2013

ACCA

F4 - 2015
F5 - 2015
• Registered Posts: 283
How did you get the target fixed production?

I have tried task 2.3 and no luck sorry :-(
Level 2 - Passed 2011
Level 3 - Passed 2012
Level 4 - Passed 2014

Awaiting to start CIMA
• Registered Posts: 782
At a quick glance, so forgive any mistakes.......

Your target cost is 35 per unit. You know that 26 of this is variable meaning that you only have 9 per unit to spend on fixed costs to maintain your 30% profit margin. Your break even number of units to cover the 200,000 of fixed costs is 200000/9 = 22222 units (rounded down)

This gives you a margin of safety of 7778 units (30000-22222) which is 25.9% of your 30,000 expected sales (7778/30000 x 100). Rounded up to 26%.

I will keep checking back in case I haven't explained any of that very well and you need me to clarify any of it.
• Registered Posts: 782
Sammmy,

You get the target fixed production as follows......

Per unit - £50 selling price. To get a 30% profit margin, 50/10 x 7 = 35 target cost. £26 of this is from the variable costs (material at £20 per unit plus £6 (20mins at £18 per hr per unit)). This leaves you with £9 per unit available to cover fixed costs per unit

Total fixed costs - £270000 (£9 x 30000 units)
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yes i get it now, thank you :-)
Level 2 - Passed 2011
Level 3 - Passed 2012
Level 4 - Passed 2014

Awaiting to start CIMA
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Thanks so much Nps1976, I was stuck on this one too. Hurrah!
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I took this in October and aced it,i got target and life cycle costing 2.1 and 2.2
I exceeded in 7/10 and met in other 3.
Hope you do ok Aaron
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Cheers Nps absolute life saver !!!!

Thanks Omega lets see what happens
AAT

Level 2 - 2010
Level 3 - 2011
Level 4 - 2013

ACCA

F4 - 2015
F5 - 2015
• Registered Posts: 120 🎆 🐘 🎆
Good luck Aaron, let us know how it went
• Registered Posts: 283
Good luck Aaron!
Level 2 - Passed 2011
Level 3 - Passed 2012
Level 4 - Passed 2014

Awaiting to start CIMA
• Registered Posts: 165 🎆 🐘 🎆
:thumbdown: Horrid horrid horrid. I think that was worse than the first one I did! Written bits were awful. Think I did better on target costing etc but the writtens were arghhhhhhhhhhhhhhhhhhhhh.
The written bits are my downfall by far.
Think another re sit is heading my way, absolutely gutted to say the least :crying:
• Registered Posts: 177 🎆 🐘 🎆
I absolutely agree Jane. The written bits were so hard!!! very unhappy today!!:glare: