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Sales Revenue

sophie_612sophie_612 LondonRegistered Posts: 107
Hi,

can someone help me on the below I've worked out someone of the answers but the other i cannot work out.

thanks
Sophie

Comments

  • sophie_612sophie_612 LondonRegistered Posts: 107

  • CheesypeesyCheesypeesy MAAT Posts: 102
    Sales revenue in April - (£1,594,600/238,000) * 20,000 = £134,000

    Direct labour
    Total labour hours in April - 21,000/6 = 3500
    Total hours worked overtime = 3500-3300 = 200. Overtime rate = 15*1.4 = £21.00 per hour.
    Direct labour cost - (3300*15) + (200*21) = £53,700.

    Variable production overhead
    Total hours for year - 246,000/6 = 41,000 hours
    Variable production overhead per hour - 95,940/41,000 = £2.34
    Variable overhead production overheads in April - £2.34 * 3500 = £8,190.
    Matthew Dearlove MAAT
    Currently on CIMA Management Level. Passed P2, F2 and E2. Preparing for November 19 MCS.
  • sophie_612sophie_612 LondonRegistered Posts: 107

    Sales revenue in April - (£1,594,600/238,000) * 20,000 = £134,000

    Direct labour
    Total labour hours in April - 21,000/6 = 3500
    Total hours worked overtime = 3500-3300 = 200. Overtime rate = 15*1.4 = £21.00 per hour.
    Direct labour cost - (3300*15) + (200*21) = £53,700.

    Variable production overhead
    Total hours for year - 246,000/6 = 41,000 hours
    Variable production overhead per hour - 95,940/41,000 = £2.34
    Variable overhead production overheads in April - £2.34 * 3500 = £8,190.

    thanks @Cheesypeesy why is that we are dividing by 6?
  • daniel_123456daniel_123456 AAT Student Posts: 25
    It is because each units require 10 minutes of direct labour each. Their is 6 sets of 10 minutes in 1 hour.
    You can also do the calculation as 21000*10/60=3500 hours
  • sophie_612sophie_612 LondonRegistered Posts: 107

    It is because each units require 10 minutes of direct labour each. Their is 6 sets of 10 minutes in 1 hour.
    You can also do the calculation as 21000*10/60=3500 hours

    thanks so much that makes sense now :)
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