MATS Lesson 1 - Starter

FIFO is a method of paying labour

Total fixed costs will change when activity levels change

Indirect costs cannot be directly identified to each unit

Direct costs cannot be directly identified to each unit

Accurate to the nearest penny

May use estimates where appropriate

Provides information to external bodies (e.g. HMRC)

Produced end of year reports (profit and loss/statement of financial position)

Egg trays for free range eggs

Telephone charges

Wages of the shop floor supervisor

Cost of heating

Salary of a shop worker

Factory rent

Salary of a director

Electricity with a daily fixed standing charge plus a usage charge per KwH

Closing inventory + opening inventory = purchases

Opening inventory + purchases - closing inventory

Opening inventory + purchases + closing inventory

Purchases + closing inventory = manufacturing overheads

£463

£400

£342

£436

At 3000 units cost = £9000, at 12000 units cost = £36000

At 1200 units cost = £4 per unit, at 2400 units cost = £4800

£100 per machine hour

£10.50 per machine hour

£1 per machine hour

£10 per machine hour

FIFO

LIFO

AVCO