January 2023

Marginal Costing: Introduction

By |2022-09-15T12:30:35+02:00January 24th, 2023|Cambridge AS A Level Accounting, Notes, ZIMSEC A Level Accounting|

Cambrige AS and A Level Accounting Notes (9706)/ ZIMSEC  Advanced Accounting Level Notes: Marginal Costing: Introduction

  • We have already looked at absorption costing here
  • Now it is time to examine marginal costing which is an alternative way of looking at things
  • For while absorption costing treats production overheads as a product cost by assigning a share of these […]
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Cost Behaviour: Fixed, Variable and Semi-variable costs

By |2022-09-15T12:32:28+02:00January 24th, 2023|Cambridge AS A Level Accounting, Notes, ZIMSEC A Level Accounting|

Cambrige AS and A Level Accounting Notes (9706)/ ZIMSEC  Advanced Accounting Level Notes: Cost Behaviour: Fixed Costs, Variable Costs and Semi-Variable Costs

  • Costs can be classified in a number of ways
  • One way to classify costs is by behaviour
  • This involves determining how certain costs will vary according to the organisation’s level of activity
  • For example how rentals change […]
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Costing for Labour: Remuneration Methods

By |2022-09-15T12:32:18+02:00January 24th, 2023|Cambridge AS A Level Accounting, Notes, ZIMSEC A Level Accounting|

Cambrige AS and A Level Accounting Notes (9706): Costing for labour: Remuneration methods

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  • Now that we have examined the basics of labour within organisations
  • It is time to look at remuneration methods
  • There are three basic remuneration […]
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Marginal Costing: Statement of Profit or Loss

By |2022-09-15T12:30:34+02:00January 24th, 2023|Cambridge AS A Level Accounting, Notes, ZIMSEC A Level Accounting|

Cambrige AS and A Level Accounting Notes (9706)/ ZIMSEC  Advanced Accounting Level Notes: Marginal Costing: Statement of Profit or Loss

  • As has been outlined here there are differences between marginal costing and absorption costing
  • One such stark difference is in the format of statements of profit
  • Below is a proforma Statement of Profit using marginal costing

Marginal Costing Statement […]

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Types of Costs: Period, Opportunity, Sunk and Relevant costs

By |2022-09-15T12:32:28+02:00January 24th, 2023|Cambridge AS A Level Accounting, Notes, ZIMSEC A Level Accounting|

Cambrige AS and A Level Accounting Notes (9706)/ ZIMSEC  Advanced Accounting Level Notes: Types of Costs: Period, Opportunity, Sunk and Relevant costs

  • In addition to looking at how costs behaviour in relation to the level of activity ( units produced)
  • It […]
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Costing for Overheads: Introduction

By |2022-09-15T12:32:18+02:00January 24th, 2023|Cambridge AS A Level Accounting, Notes, ZIMSEC A Level Accounting|

Cambrige AS and A Level Accounting Notes (9706)/ ZIMSEC  Advanced Accounting Level Notes: Costing for Overheads: Introduction

  • A business needs to know the cost per unit of its products for many reasons
  • For example in order to be able to:
  • Value its inventory properly
  • Come up with an appropriate selling price so that they can ensure they are making […]
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Reconciliation of absorption and marginal profits

By |2022-09-15T12:30:33+02:00January 24th, 2023|Cambridge AS A Level Accounting, Notes, ZIMSEC A Level Accounting|

Cambrige AS and A Level Accounting Notes (9706)/ ZIMSEC  Advanced Accounting Level Notes: Reconciliation of marginal costing and absorption costing profits

  • Because absorption costing includes the cost of fixed overheads in:
    1. Opening and closing inventory and
    2. Cost of sales
  • There will be inevitable differences in profit figures calculated using the two methods
  • These differences will arise whenever there […]
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Direct materials, indirect materials and labour

By |2022-09-15T12:32:27+02:00January 24th, 2023|Cambridge AS A Level Accounting, Notes, ZIMSEC A Level Accounting|

Cambrige AS and A Level Accounting Notes (9706)/ ZIMSEC  Advanced Accounting Level Notes: Types of Costs: Direct materials, indirect materials and labour

  • It is important to point out at this stage that there are generally three types of entities:
    1. Manufacturing entities that make goods and sell them
    2. Merchandising entities that purchase goods and sell them for a profit […]
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Absorption Costing: Introduction

By |2022-09-15T12:30:47+02:00January 24th, 2023|Cambridge AS A Level Accounting, Notes, ZIMSEC A Level Accounting|

Cambrige AS and A Level Accounting Notes (9706)/ ZIMSEC  Advanced Accounting Level Notes: Absorption Costing: Introduction

  • As already said in the introduction to costing for overheads
  • Businesses need to know the cost of production for each unit of production
  • There are many reasons why a business would need to know this:
    1. To calculate a selling price that […]
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The differences between marginal and absorption costing

By |2022-09-15T12:30:32+02:00January 24th, 2023|Cambridge AS A Level Accounting, Notes, ZIMSEC A Level Accounting|

Cambrige AS and A Level Accounting Notes (9706)/ ZIMSEC  Advanced Accounting Level Notes: Marginal Costing vs Absorption Costing

  • Having introduced you to both absorption costing and marginal costing
  • It is time to look at some of the differences between the two
  • In discussing marginal costing we have already pointed out the differences between it and marginal costing

    • […]

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