Factory B Materials

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
I calculated the material figure for Factory B's revised profit and loss account by adding 40% of Factory A's material to Factory B's figure, took away stock for both sites (just in time needs no closing stock) and took 5% from this figure................no-one else seems to have done it this way!<BR>Am I wrong????? Feeling stupid!

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Factory B Materials

    you are absolutely right as i also have done on that same way.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Factory B Materials

    how about those memo thing at the end?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Factory B Materials

    seem to remember i did the 40% of a and added it onto b and i did remember to take 5% off but forgot to take off the closing stock!!! ( remembered to take it off and the creditors ( as creditors was materials) from A when reworked out the roce)<BR><BR>revising all day today for thursdays exam now. then weds got to get to grip with cap gains tax!!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Factory B Materials

    Hi Arjun...........bit of a releif, either we are both right or both wrong!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Factory B Materials

    Good luck with the Tax exam...........I'm begining to study that next week! Got one more exam tomorrow for Financial Statements then nothing til June.<BR>I didn't go as far as to work out the ROCE, just did the GP% and NP% for Factory B after closure of Factory A, I also didn't include the cost of closing Factory A in B's revised P&L, I just made a note in my memo.........didn't know if closure costs were relevant to B........don't suppose there is a "right" answer, just hope I did enough......roll on Valentines Day!!!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Factory B Materials

    <BR>I worked out a materials price per unit (and for labour) for the old production amount then multiplied by the new amount. Only because the first few lines of the question said that each general manager set their own pricing and purchasing prices, therefore A's figures should'nt really apply to B, maybe thats over complicating it. To be honest i think the question was a bit vauge in how it asked for the labour and materials to be calculated as obviously doing 40% came out with a round number (which is how you usually tell if your on the right track with AAT). As it was a revised 'forecast' i think any method that seemed reasonable should get the marks - whether they actually gonna mark it like that is another matter
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Factory B Materials

    I think in question 2.2 asked only revised profit and loss account for Factory B assuming Factory A is closed. I only did up to profit and loss. In task 2.3 performance indicators I only calculated gross profit and net profit. I don't know whether it is right or wrong. I didn't deduct closing stock from balance sheet probably I should have. I don't know. Please someone can help me???????

Categories

Privacy Policy