Hi,
I am having trouble computing the P&L by Financial accounting, specially when computing the costs. Can show the resolution of this part of the exercise, please.
Thank you.
Hello Marta,
For the P&L according to Financial Accounting, the costs should be divided into CMSMU, Personnel Costs, Miscellaneous Costs, and Depreciation.
For the P&L according to Financial Accounting, the costs should be divided into CMSMU, Personnel Costs, Miscellaneous Costs, and Depreciation.
For the CMSMU, only the consumption of Direct Materials should be included (which you already have from question 1) - this value should be 156 000€. Then, for the Personnel costs, one need to include every costs related with personnel/ wages, irrespective of their function (it can be manufacturing, selling, administrative or general). In this case, personnel costs also include the comissions of the sales staff.
Finally, miscellaneous costs include any expenses not related to Direct Materials, Personnel, or Depreciation.
If you have any issues reaching the final results, please show us your calculations, and we will help you!
Best Regards,
Madalena Paiva
I also have a question about problem 4. I am of by a 100, and I assume it is because of the WIP. Where in Financial accounting do you account for the wip? In what category?
Hello Marith,
Could you please explain what you did in this exercise? Nevertheless, since you're only off by 100, I would say you forgot to add the change in WIP inventories, as you pointed out.
When preparing the P&L according to FA, as you can see in the image below, we add the Change In Inventories after the sales. That change includes both FG Inventories and WIP Inventories, so that is probably what you forgot to add.
Hope this helps!
Pedro Perdigão
Could you please explain what you did in this exercise? Nevertheless, since you're only off by 100, I would say you forgot to add the change in WIP inventories, as you pointed out.
When preparing the P&L according to FA, as you can see in the image below, we add the Change In Inventories after the sales. That change includes both FG Inventories and WIP Inventories, so that is probably what you forgot to add.
Hope this helps!
Pedro Perdigão
Hello, I know that CMSMU in this case is 156000 but, all other costs go for the Miscellaneous Costs? And wages and comissions for personnel?
Could you please upload the P&L by FA?
Could you please upload the P&L by FA?