AAT Advanced diploma synoptic - Practice paper 2 - Task 3 c) (i)

amycheese1993
amycheese1993 Registered Posts: 1
Hello

Can anyone tell me how to work out the depreciation expense for the year?
The answer is £124000.

Many thanks

Comments

  • amycheese1993
    amycheese1993 Registered Posts: 1
    Please see attached for the full question
  • amycheese1993
    amycheese1993 Registered Posts: 1
    Please see attached for the full question
  • annefoth
    annefoth Registered Posts: 39
    Should there be an attachment?
  • Ssanta
    Ssanta Registered Posts: 4
    edited October 2021
    (Non-current assets at cost) 920000 - (Non-current assets accumulated depreciation) 300000 = 620000 (carrying amount)
    Depriciation expense for the year = 620000*20%=124000
    PhilJRoo76
  • Ssanta
    Ssanta Registered Posts: 4

  • PhilJRoo76
    PhilJRoo76 SouthseaRegistered, AAT Student Posts: 29
    Thanks for the explanation for the answer. I've my exam this coming Thursday (11th) and all help in the forum very helpful.
  • PhilJRoo76
    PhilJRoo76 SouthseaRegistered, AAT Student Posts: 29
    Actually, I have an extra question for task 3D, in assessment 2, right underneath the question you've highlighted above, the question relates to working out both the actual contribution for the period as £680,000 and the actual fixed costs of £412,000, can anyone show me the working out for those answers? You'll see the questions on assessment 2, section 1.3 D? Thanks in advance for any help.
  • Ssanta
    Ssanta Registered Posts: 4
    edited November 2021



    For 3 (d)
    (i) Actual Contribution for period is 680000

    From the following extract of New Place trial balance at 31 December 20X7 You take Sales revenue value (3200000) and take away Direct materials (2340000) and Direct labour (180000)
    3200000 - 2340000 - 180000 = 680000

    Sales revenue - variable costs = contribution

    (ii) Actual Fixed costs, adjusted, are 412000

    From table you take Overhead value (288000) and add calculated in (c) (i) deprication expense (124000)
    288000+124000=412000 (fixed costs)

    the questions (iii) and (iv) are explained in ansvers provided by AAT:

    (iii) Calculate the break-even volume based on the actual figures or 20X7. You must
    show your workings. (2 marks)
    The revised break-even volume, using the actual figures, is 12,118 units.
    Workings:
    Actual contribution per unit = £680,000/20,000 units = £34 per unit (1)
    Actual break-even sales volume = Fixed costs/Contribution per unit: £412,000/£34 = 12,118 units (1)


    (iv) Explain why the actual break-even point for 20X7 was different from the budgeted
    break-even point. (2 marks)

    Candidates are not expected to raise all the points above for the full marks, but their inclusion here
    serves to indicate the depth of knowledge required for each item.
    The actual break-even volume of 12,118 units is higher than budgeted at 12,000 units and has been
    affected by the following changes compared to the budget:
    (i) Decreased fixed costs, which have fallen from £600,000 to £412,000, this reduces the break-even
    volume required. (1)
    (ii) Much lower contribution per unit than budgeted, which increases the break-even volume required.
    (1) Budgeted contribution per unit was £170 - £120 (or £600,000/12,000) or (£600,000 +
    £400,000)/20,000) = £50 per unit, compared to actual contribution of only £34 per unit. (1)
    The reduced contribution per unit compared to the budget has been caused by a reduced average
    selling price per unit (budget £170, actual £3,200,000/20,000 = £160), (1) plus an increased unit cost
    (budget £120, actual £2,520,000/20,000 = £126).

  • PhilJRoo76
    PhilJRoo76 SouthseaRegistered, AAT Student Posts: 29
    It was just unfortunate that I was sitting my exam when your response came through on here. Ooh well, at least I know what to expect when I re sit. Thanks!
  • Ssanta
    Ssanta Registered Posts: 4
    Sorry! I re-sat this exam 3 times already. I know it is not encouraging but it will be fine. Sat my exam on 9th and waiting for results now but unfortunately I think I failed as most of my question were definitely in klingon. Good luck. I hope you pass.
  • PhilJRoo76
    PhilJRoo76 SouthseaRegistered, AAT Student Posts: 29
    edited November 2021
    Thanks. But, I'm not even going to bother checking my result when it comes out, it was that bad. Just waiting till payday and going to put in for it again. Ooh well.
  • jettimmax1
    jettimmax1 Registered, AAT Student Posts: 7
    Hi

    this is also something I am also struggling with

    Can anybody help me with, What could be fixed cost different variations? Admin Costs, Overheads, Rent?

    and what be variable? Material and Labour?

    If we wanted to work out our profit for the year, take our sales revenue minus variable minus fixed cost?

    Do we take into consideration at any point accumulated depreciation?
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