PEV Dec 05 Question

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Hi,
I am having a really bad hair day and cannot work out how they got the original standard cost for question 1.2 ii
How do you work out the 'old' standard cost???
any help would be greatly appreciated


T
xx

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PEV Dec 05 Question

    I have found the answer - oh dear it was under my nose!! ..... told you I was having a bad day!!!
    thanks for looking at my post anyway!!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PEV Dec 05 Question

    The $ rate has devalued by 5%, so you need to take
    the value of materials used x orginal cost
    =130,000 kg x£0.50 =£65,000.00

    Then the revised valuation=
    =130,000kgx(£0.50/1.89x1.80)( gives you a revised value per kg of £0.476) = £61,905

    Total Material price variance = £6,500 F

    Orginal cost £65,000
    Less
    revaluation £61,905
    =£3,095 F due to rate variance
    =£3,405 F due to other reasons
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PEV Dec 05 Question

    hi,
    thank you!!
    It all looks so simple when someone else does it!!
    It has been a great help thanks

    T

Categories

Privacy Policy