Understanding changes in ACCA/FIA exam format by December 2011
After the introduction of Foundations in Accountancy (FIA) - suits of qualifications, many important things have gone under the change phase and the most affected under ACCA qualification are the knowledge module exams i.e. ACCA F1, ACCA F2 and ACCA F3. This ASK TUTOR SPECIAL episode will be about understanding the changes in exam formats […]
Why LIFO is not permissible under IFRS?
After the revision of IAS 2 Inventories in 2003, LIFO was explicitly prohibited to be used by the entities following International Accounting Standards to prepare and present financial statements. Before this revision LIFO was available as allowed alternative i.e. an option if company wishes to use the inventory valuation method other than the preferred method. […]
Does Standard costing means costing based on cost accounting standards like financial accounting standards?
Standard costing does not mean cost accounting using uniform cost accounting standards similar to financial accounting standards. The main purpose of financial accounting standards is to have such set of financial statements for every entity that is comparable with other entity’s financial statements and also to have uniform basis of accounting for different transactions that […]
What is Normal costing?
Right at the very start of cost accounting we understand that decision making is one of the crucial and an ongoing process in every organization. Managers have to decide about many things all the time and for this they need relevant and reliable information or to be specific complete information. This is where cost accounting […]
What is the difference between Waste, Scrap, Spoil and Defect?
Waste: This is a loss connected with raw material or inputs to the production process and usually means to refer that input has been lost due to any reason either because of its nature of the material itself, nature of the process or some other conditions. Sometimes such output that does not have any sales […]
Can direct costs be fixed and indirect costs be variable costs?
Classifying costs as direct or indirect cost is one way of cost classification whereas classifying costs on the basis of their behaviour as fixed or variable costs is just another way of classification of costs. Both classifications are separate and must not be confused together. The cost that can be traced back to a product […]
What is a non-linear variable cost?
Variable costs are such costs that change with the change in business activity level. For example if production level changes then some costs of production will change as well. This change can either be in the same direction (direct relationship) i.e. if activity increases then cost increases as well OR it can be in the […]
What is HIFO?
HIFO is an acronym for Highest in, First out. This inventory valuation method assumes that inventory with highest bought in value i.e. highest purchase price in the stock will be consumed first or in other words will be sent out to production hall at first place. One of the main advantage of using HIFO method […]
What is the difference between Negative assurance, Positive assurance, Negative opinion and Negative report?
Difference between Negative assurance and Positive assurance Many students get confuse in these things and mostly it is because books usually use such terminologies which prevail in the business world which are most of the time shortened up and thus sometimes lose their meanings. Lets start with Positive and Negative assurance. Many students think that […]
What is Opportunity cost and why is it a Relevant cost as well?
Opportunity costs are defined to be the economic value of the benefit sacrificed under one alternative to avail the benefit under another alternative course of action. For example, company have the option of manufacturing either alpha or beta. As company does not have enough resources to manufacture both of them so it will have to […]
