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Management Accounting > MAC Formulas > Flashcards

MAC Formulas Flashcards

1
Q

What is the formula for ‘standard full cost price’

A

(total fixed costs / normal production) + variable cost per unit

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2
Q

What is the formula for ‘straight line depreciation’

A

(purchase price - scrap value) / number of periods

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3
Q

What is the formula for ‘reducing balance’

A

rate = 1 – (scrap value / purchase price) ^ 1/n

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4
Q

What is the formula for ‘sum of the years’s digit’

A
  1. fraction = remaining years of useful life / SYD

2. (purchase price - scrap value) x fraction

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5
Q

Contribution margin per unit

A

sales price - variable cost per unit

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6
Q

Break-even sales level

A

total fixed costs / contribution margin per unit

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7
Q

What are the steps of the optimal production plan?

A
  1. Determine the key factor that is restricted
  2. Calculate the contribution margin for each product
  3. Calculate the contribution margin per … (restricted key factor)
  4. List products from highest margin to lowest
  5. Calculate how many of the 1st place can be made (normal capacity)
  6. Determine how much of the restricted factor is left for other product(s)
  7. Calculate how many of the other products can be made with remaining factor
  8. State optimal production plan
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8
Q

What are the four steps to calculate Absorption costing?

A
  1. Calculate the Full Cost Price
  2. Calculate the Sales Volume Result
  3. Calculate the Production Volume Variance
  4. Calculate the Profit
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9
Q

What is the formula to calculate the full cost price?

A

variable cost per unit + (total fixed costs / normal production)

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10
Q

What is the formula to calculate the Sales Volume Result?

A

quantity sold x (sales price - full cost price)

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11
Q

What is the formula to calculate the Production Volume Variance?

A

(actual production - normal production x (TFC / NP)

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12
Q

What is the formula to calculate the profit under absorption costing?

A

Sales volume result + production volume variance

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13
Q

What are the two steps to calculate direct costing?

A
  1. Total contribution margin

2. profit under direct costing

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14
Q

What is the formula for Total Contribution Margin?

A

quantity sold x (sales price - variable costs per unit)

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15
Q

What is the formula to calculate the profit under direct costing?

A

total contribution margin - total fixed costs

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16
Q

What are the five possibilities by which you can analyse a variance?

A
  1. Sales Volume Variance
  2. Sales Price Variance
  3. Efficiency Variance
  4. Price variance
  5. Fixed cost variance `
17
Q

What is flexed budget?

A

The level of revenues and expenses, taking into account the actual volume but using the budgeted variable cost and sales price per unit

18
Q

What is the budgeting cycle?

A

Planning targets; analyzing variances from the targets; find ways for improvements; planning again

19
Q

What is the formula for Sales Volume Variance?

A

(Actual sales volume - budget sales volume) x profit margin per unit

20
Q

What is the formula for efficiency variance?

A

(Standard quantity of inputs - actual quantity of inputs) x standard price per input

21
Q

What is the formula for price variance?

A

(Standard price of input - actual price of input) x actual quantity of input

22
Q

What is the master budget?

A

Shows the objectives for the period. It quantifies the expectations for revenues and expenses by forecasting.

23
Q

What is a budget?

A

A quantification of a proposed plan of action. It serves as an aid to the coordination and implementation of that plan.

24
Q

The master budget..

A

brings together the objectives of each of the departments for the period to come and uses that to calculate the profit. It gathers information about the expected sales price, the sales quantity, the production and related costs.

25
Q

The flexed budget..

A

is prepared at the end of the period and uses all the information from the master budget, but adjusts it with the actual quantity produced and sold. This way you can calculate the flexed profit, what the profit should have been if the actual quantity sold and produced would have been predicted accurately.

26
Q

What is the formula to calculate the expected profit?

A

expected quantity sold x (sales price - variable costs per unit) - total fixed costs

Management Accounting (1 decks)

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