MARGINAL BLOODY COSTING RECONCILIATION

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
What! help, cant belive this one was thrown in!!!!

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    I'm so glad you feel the same way. I spent far too long on it, worried now I messed it up.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    i found a lot of people struggled with this when i come out of my exam, hopefully will be a low competence mark put on it!!!!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    Come on guys, that was simple surely !
    Just take out the fixed costs, we learnt that at intermediate level !
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    Never covered it in college, Understand the idea, but surely the fixed overhead costs need to come in somewhere to give total cost.

    I layed out the marginal costs, and went down to contribution but then carried on to fixed cost, should I have stopped at contribution?

    Might get some marks for the top end then
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    I only knew about the difference being fixed costs were excluded from the marginal costing statement. Hopefully I'll get one mark for this, wasn't overly sure as to why they weren't included!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    Hiya,

    Yeah I did the same, and put the fixed costs at the end and analysed the expenditure variance - forgot to take away variable costs from sales and calculate acutual contribution though.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    Because the question asked you to reconcile it to the operating statement in the previous task, I assumed it was just a question of taking the actual totals spent to match the adjusted operating statement - oh darn!!!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION
    Kate Short wrote:
    Hiya,

    Yeah I did the same, and put the fixed costs at the end and analysed the expenditure variance - forgot to take away variable costs from sales and calculate acutual contribution though.

    I assume that you took a sales figure from Section 2 then? I would not expect to have to get information from later tasks to use in earlier tasks. As the information provided in Section 1 did not give sales information - how can we be expected to work out contribution?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    Ignore me I'm just rambling, I didn't put a sales figure in at all I just read the word 'contribution' and realised I never wrote it. Sorry for confusion, post exam manicness!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    Completely understood!!! :lol:
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    That sounds like youve done fine, so dont worry about.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION


    Hi there

    I completely messed up the marginal costing statement. I knew that the only overhead variance to be included was expenditure, but i didn't take out the fixed costs from the figures in the reconcilliation.

    I used the same figures as in the absorption statement. It still balanced though?

    I think i was panicing because i couldn't balance the first one. I eventually did it but didn't have enough time to go back to marginal costing question.

    Do you think i'll lose many marks?

    Thanks
    Kath
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION


    Hi there

    I completely messed up the marginal costing statement. I knew that the only overhead variance to be included was expenditure, but i didn't take out the fixed costs from the figures in the reconcilliation.

    I used the same figures as in the absorption statement. It still balanced though?

    I think i was panicing because i couldn't balance the first one. I eventually did it but didn't have enough time to go back to marginal costing question.

    Do you think i'll lose many marks?

    Thanks
    Kath
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION

    Did anybidy get the variance betwee the 2 reconciliations as £28,000??? As this was the over absorption of overheads as the actul cost was £260,000 but the absorption rate was £48 per hour (therefore £48x6000 direct labour hours = £288,000)
    The difference was this as the marginal cost only includes the £260,000 whereas absorption costing uses the predetermined rate of £48 per hour....ANYBODY ELSE GET THIS????
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:MARGINAL BLOODY COSTING RECONCILIATION


    i got the difference 36000, which represents the overhead volume variance which we didnt use in marginal.

    however, not pretty sure that overhead expenditure variance should be included

    good luck

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