Management accounting unit answers for workbook - diploma level: fixed cost variances

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Hi
Does anyone know if the tutor pack for the workbook can be downloaded from anywhere for unit 33?

I am ok with all the formulae but towards the end of chapter 3 is a horrible wordy question which has puzzled me! i somehow mangaged to reconcile all costs correctly but am struggling with the capacity and efficiency volume variances.

Its trying to work out which of the holidays, flights, no passengers etc should be hours and material that is confusing me!!

Any help would be appreciated

Thanks

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Management accounting unit answers for workbook - diploma level: fixed cost variances

    I will try and help, but can you tell me, what book you are using so I can have a look at it (I use the FTC Text Books)... SO if it is not FTC can you please post the qquestion, so, me or someone else can try and help :)
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Management accounting unit answers for workbook - diploma level: fixed cost variances

    oh yes i didn't realise i hadn't said which book - its the osbourne workbook.

    question is:

    'island holidays ltd specialises in arranging holidays to a small island. the company uses its own 105-seated aircraft to transfer tourists to and from the island. the following report was presented to the manager of island holidays ltd:

    operating statement for quarter 3, 2004:

    Budget:
    No holidays - 6000
    Turnover - 1800000
    Accomodation - 840000
    Air transport - 720000
    Operating profit - 240000

    Actual:
    No holidays - 7800
    Turnover - 2262000
    Accomodation - 1048944
    Operating Profit - 421056

    The manager considers this report unhelpful and requests a standard costing report, reconciling the standard and actual costs for the actual holidays sold in the quarter.

    The accomodation cost is a variable cost and the usage variance is zero.

    Air transport is a fixed cost.

    The budget for a volume of 6000 holidays was based on air transport capacity of 80 return flights in the quarter, with an average of 75 tourists per flight. these standards were used to calculate the fixed overhead absorption rate when costing individual holidays.

    Due to weather conditions, there were only 78 flights in this quarter, carrying a total of 7800 tourists.'

    I have calculated the fixed o/head price and volume variances and these reconcile but its the capacity and efficiency i'm struggling to work out - sorry its a bit long but thanks for looking!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Management accounting unit answers for workbook - diploma level: fixed cost variances

    This is very similar to an old question sent out by the then examiner John Watts when this unit was about to be tested for the first time as MCV.

    It is unique in terms of AAT questions in that the capacity is limited by the seats on the aeroplanes. They budget to fill fewer than the actual number of seats available.

    I appreciate that you have asked for the answer (I will have a look to see if I have one) but perhaps this might be more useful as a clue to how you might approach it.

    sandy.hood@chichester.ac.uk
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Management accounting unit answers for workbook - diploma level: fixed cost variances

    Hi,

    Rather than giving you the answer, I have PM'd you so I can send you my notes on this, which I think will help you out.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Management accounting unit answers for workbook - diploma level: fixed cost variances
    This is very similar to an old question sent out by the then examiner John Watts when this unit was about to be tested for the first time as MCV.
    I agree, I took this exam in Dec 03(I think), so if you can still get the answers to that years paper it may help.
    (I remember it very well as I couldn't answer it and spent the next few months panicking because I was told I'd failed as I hadn't answered all the questions - I passed)
    J
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Management accounting unit answers for workbook - diploma level: fixed cost variances

    Angela

    Just a follow up posting

    Did the guidance from here help?
    Have you successfully completed the question now?

    Sandy
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Management accounting unit answers for workbook - diploma level: fixed cost variances

    Hi

    Sorry I haven't had chance to look at it again yet but will be doin this weekend

    Thanks for all your help so far i'l let you know if i can figure it out or not!!

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