# Budgeting Exam in 2weeks

Registered Posts: 37
I have my budgeting exam in 2weeks and feeling quite nervous about it. Currently doing the AAT Sample test 2 and struggling with the calculations on 5 b and 6 b & c . Would be grateful if anyone could help with these ? Many Thanks.

• Registered Posts: 57
Hi Emma,

Right, on 5B the sales revenue is pretty straight forward. The sales revenue for the year is £1575000 and units sold was 315000, so that's £5 per unit. In June, they sold 27000 units, so multiply by £5 = £135000.

Materials used - This is where you need to look at the Units produced. In the year the total is £855900 / 317000 = £2.70 per unit is the variable cost. Multiply this by 26500 produced in June = £71550, do this for the remaining costs (apart from Fixed as this is a yearly total evenly allocated over each month).

6B - You need to work out the standard cost, basically what it should cost! So 5000 items should be 35 mins per unit and £12 per hour. So the cost should be £35000 (5000 x 35 / 60) x £12 = £35000.

Actual labour rate is the actual costs (£31250) divide by the hours worked (2500) = £12.50.
Actual minutes per item, hours worked against items made (2500 hours / 5000 units) = 30 mins
Rate Variance = we paid 50p an hour more than budgeted, over 2500 hours equals £1250 adverse variance.
Efficiency Variance = so we are 5 mins quicker per item than budgeted, 5 mins x 5000 units / 60 = 416.6666 x £12 an hour = £5000 favourable.
Cost varaince is the actual versus the flexed which is /33750 favourable, you can double check by checking your workings e.g £5000 fav minus £1250 adverse = £3750 favourable.

6C = Have a go yourself, you will be fine
• Registered Posts: 37
Thank you Rusty1985 this is very helpful :-) I'm dreading my exam next week , have you passed level 4 now?
• Registered Posts: 57
Not yet, im waiting for my Budgeting result, still a few weeks away yet but pretty confident I have passed. How did your exam go?
• Registered Posts: 37
It went ok , but i forgot to put the adverse and favourable one of the questions the last question and there is like 10 of them so i think i will have lost 10 marks i could literally of kicked myself i cant believe i forgot to put them on probably the easiest bit of the exam so i'm a little angry with myself but i was rushing and forgot . the writing element wasn't great either i tried to stick to the point but not sure if i wrote enough . i'm not feeling great about it to be honest probably because the adverse and favourable situation. The calculations were all ok i managed them fine. what exam have you got next ?
• Registered Posts: 57
Hi Emma, there were alot of marks available on the exam so try and remain confident , I think on the budgeting exam there were 160 marks available and im not sure if its 10 marks for adverse or variable on the last question as you say as its quite an easy part of the exam. (In my practice exam, I forgot them too, its easily done). In the writing, as long as you put the main point across you tend to get a bulk of the marks. My next one is Decision making and Control, im not starting it until my results for the budgeting come through, nice to have a little break. Try not to beat yourself over it too much, and enjoy your weekend. Let me know how you get on, and if you need help with anything, please just ask and il try my best.
• Registered Posts: 37
That's what i'm hoping for , i cant see it being 1 mark per Adverse or favourable but you never know. I waited until i received my results through from financial statements to start my budgeting but i'm going to have this weekend off then start Decision and control next week . Good luck to you as well let me know if you passed when you get your results back in a few weeks time .
• Registered Posts: 57
Hi Emma, Yes I passed Budgeting in the end, 83%. Have you had your result yet? Best of Luck. :-)
• Registered Posts: 37
That's Great , well done :-) get my results next Thursday i think ( not looking forward to it).. are you now starting decision and control?
• Registered Posts: 57
Yes, I am about half way through it now. How did you get on in your exam?
• Registered Posts: 37
I failed 65% :-( my next exam is on the 29th January.... when are you taking your decision and control exam ? I've also booked that in for the end of feb.
• Registered Posts: 57
emma8021 said:

I failed 65% :-( my next exam is on the 29th January.... when are you taking your decision and control exam ? I've also booked that in for the end of feb.

Hi Emma, Im sorry to hear that, you will definitely do it next time :-). My decision and control exam is 6th February. 5 more hours of lectures to go then lots of revisiting things and learning formula (fun, fun).
• Registered Posts: 37
I managed to pass this time :-) how did the decision and control exam go ?