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WorksheetsAAT L2 Costing 04 Behaviour Fixed, Variable & High Low Method
Total questions: 21
Worksheet time: 21mins
Variable Cost is a cost that changes in proportion to the level of output or activity. (a)
Fixed cost is a cost that does alter in total when the level of output or activity changes. (a)
Semi-variable cost, is a cost that contains both a fixed element and a variable element. (a)
High-low method is:
the way the costs alter with changes in the level of output or activity.
a technique for calculating the variable and fixed costs that comprise a semi variable cost by analysing the total costs at two activity levels.
a technique for calculating the fixed costs that comprise a semi variable cost by analysing the prime costs at two activity levels.
Which statements are true.
Cost behaviour examines how costs respond to changes in the level of output or activity. Costs can behave in one of several ways, including as fixed costs, variable costs and semi-variable costs.
An understanding of cost behaviour can be used to enable the calculation of total costs and unit costs using simple arithmetic.
The high-low method can be used to analyse semi-variable costs at two activity levels splitting out the variable and fixed parts. This information can then be used to calculate the total costs at other activity levels.
Cost behaviour examines how labour costs respond to changes in the level of output or activity. Costs can behave in several ways, including as fixed costs and semi-variable costs.
An understanding of cost behaviour can be used to enable the calculation of the maximum profit and unit selling price using simple arithmetic.
Identify fixed costs
Employee paid basic wage plus commission based on production quantity
rent of the factory workshop
print ink used for letterhead and logos
Identify semi-variable costs
Employee paid basic wage plus commission based on production quantity
rent of the factory workshop
print ink used for letterhead and logos
Identify variable costs
Employee paid basic wage plus commission based on production quantity
rent of the factory workshop
print ink used for letterhead and logos
Identify false statements
many fixed costs are only fixed over a certain range of output
variable cost per unit falls as output rises
direct costs are generally variable
fixed cost per unit rises as output rises
CALCULATE THE FIXED COST PER ITEM:
Munich Ltd makes outdoor gym equipment. It incurs fixed costs of £50,000 per year in relation to the manufacture of its outdoor treadmills. Calculate the fixed cost per treadmill at 25,000 output level.
fixed cost per treadmill £50
fixed cost per treadmill £5
fixed cost per treadmill £2
fixed cost per treadmill £0.50
CALCULATE THE TOTAL VARIABLE COST PER ITEM:
Munich Ltd also incurs £35 per treadmill for variable costs in manufacturing the treadmills. Calculate the total variable cost for the treadmills, at output levels of 1,000 and 25,0000 units.
£350,000 and £87,500
£35,000 and £875,000
Using the information in the scenario below for 1,000 units, identify the fixed costs, variable costs, total costs and unit cost at 3,000 units of production.
At 1,000 units
Fixed costs £37,200
Variable costs £19,800
Total costs £57,000
Cost per unit £57.00
units fixed costs variable costs total costs unit cost
1,000 £37,200 £19,800 £57,000 £57.00
units fixed costs variable costs total costs unit cost 3,000 £37,200 £39,600 £76,800 £38.40
units fixed costs variable costs total costs unit cost
3,000 £37,000 £59,400 £96,500 £32.10
units fixed costs variable costs total costs unit cost
3,000 £37,200 £59,400 £96,600 £32.20
FIND THE TOTAL OF FIXED COST:
At 3,500 units the total cost is £24,000
At 6,000 units the total cost is £34,000
2.85
£5.60
£10,000
£4.00
(Embed H&S)
Which Act states that each organisation with more than 5 employees needs to carry out a risk assessment and explains how employers should manage it?
Manual Handling Operations Regulations 1992
Health and Safety at Work Act 1974
Management of Health and Safety at Work Regulations 1999
Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 1995
(Embed British Values)
As part of their pledge to become a British citizen, new citizens promise to not break the law.
True
False
(Embed British Values)
If you wish to be a permanent resident or citizen of the UK, you should:
- respect the rights of others, including their right to their own opinions
- treat others with fairness
- look after yourself and your family
- look after the area in which you live and the environment
and which other?
Pass your driving test
Respect and obey the law
Work full-time
Go to university
(Embed Equality and Diversity)
The view that cultures, races, and ethnicities, particularly those of minority groups, deserve special acknowledgement of their differences within a dominant political culture.
Racism
Multiculturalism
Inequality
diversity
(Embed Maths)
What is the mode?
the number that comes up the most
the average
subtracting the biggest number from the smallest
the middle number
(Embed Maths)
What is the range?
the number that comes up the most
the average
subtracting the biggest number from the smallest
the middle number
(Embed Safeguarding)
If a client sends you an online message via Twitter or Facebook that is mean or makes you uncomfortable, you should:
Delete them from your "friend" list
Delete the message
Insult them back
Tell your manager
USING HIGH - LOW DATA:
Find the variable cost per unit and fixed costs (in total) for 7,000 units of production.
A semi-variable cost totals
£26000 when 5,000 units are made and totals
£38,000 when 9,000 units are made.
Variable cost per unit £2.40 x 7,000 = £16,800
Fixed cost in total £12,000
Total cost for 7,000 units £28,800
Variable cost per unit £3.00 x 7,000 = £21,000
Fixed cost in total £11,000
Total cost for 7,000 units £32,000
Variable cost per unit £3.00 x 7,000 = £21,000
Fixed cost in total £12,000
Total cost for 7,000 units £33,000
