PEV - Section 1

System
System Posts: 100,534 🤖 Admin 🤖
edited 10:26AM in AAT student discussion
Did anyone else find section 1 a struggle? I think i got 58,800 kg as my standard - did anyone else get that?

First of all I just worked out the budgeted figures. but i realised that was wrong when i had to use standard figures, so i just worked out what the budgeted figures were, divided them by 112000, then times them back by 117600.

Is that the right way to calculate a standard?

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PEV - Section 1

    Hiya
    Yes think thats what I put, think we calculated it right! hopefully someone else will say they done it that way too!! :wink:
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PEV - Section 1

    sounds familiar to me too. But to be honest my brains forgot all about PEV now and it's onto DFS. As soon as my exams over everything I've learnt goes completely.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PEV - Section 1

    I completely messed up section 1 too.

    For the variances your supposed to use standard - actual. I just used the budgeted figure.

    In all past papers they ask a question like 'the number of hrs based on standard production'. They didnt this time round so i forgot all about working this out.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PEV - Section 1

    In response to the OP, I'm not quite sure about what you said about standards, (although I'm probably reading it wrong)...

    As I understand it, standards are budgeted costs, & are calculated (based on budget figures) as follows:

    Standard cost per kg or hr = budget cost divided by budget kgs/hrs
    Standard kg or hr use per unit = budget kgs/hrs divided by budget units


    You then work out 'the standard cost of the actual production' - what production should've cost based on your budget:

    Standard cost of materials/hours = actual amounts used x standard cost per kg/hr (from above calcs)

    Hope that explains a bit more.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PEV - Section 1

    there were a few things in that paper that were confusing but i thought section 1 was ok generally! it was section 2 that was a pain!

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