AN5

NE E K
E
EV W

G
K
R
U
A
L
E
C
C
BRR M
M

S
I
S
Y
L
A

OBJECTIVES FOR TODAY

All students should understand what accountants mean by COST

accounting (Grade C)

All students should be able to categorise costs by element and by

behaviour (Grade C)

All students should be able to calculate the break-even point by formulae

and by graph (Grade B/C)

Most students should be able to assess the use of break-even for profit
targeting (Grade B)

Some students should extend the analysis to assessing the limitations of

break-even (grade A)

FROM THE AQA ACCOUNTING

SPECIFICATION

Terminology: direct costs, indirect costs, variable costs,

contribution, marginal cost, break-even, etc.

Calculating break-even point by use of formulae/graph

Limitations of break-even analysis by formula and graph

Regularly gets examined (75% of the time)

COST ACCOUNTING INTERESTING!

Query: I am an accountancy teacher! I dont have

a clue about my departmental costs (SHOCKING)!

Why would it be useful for me to know how much

it COSTS to teach EACH ACCOUNTING STUDENT?
In pairs/threes discuss and place some points
below:

HOLD ON WHAT ARE COSTS?

Using your textbook (chapter 10), I want you to work

together to find the different ELEMENTS of costs, define them
(AO1) and then give examples of each of them (AO2) look at
the first objective! Ensure you are learning towards this
objective!

TIME FOR A QUICK TEST OF YOUR

SKILLS!

I want you to use the postit note provided and write

down three examples of costs

On the back of the postit note you must classify

those costs into their elements (write the answer)

Give the postit note to your partner and see if they

can come up with the same classification as you!

If your answer is different from your partners, then I

want you to discuss the classification with them,
determine who is right? Are you both right?

CLASSIFYING COSTS BY BEHAVIOUR

Using your textbook again, I want to work

together to find the different behaviours
costs have, define them (AO1) and then give
examples of each of them (AO2)

TIME FOR A QUICK TEST OF YOUR

SKILLS!

I want you to use the postit note provided and write

down three examples of costs try to think of difficult
costs and give your brains a workout!

On the back of the postit note you must classify those

costs into their behaviours (write the answer)

Give the postit note to your partner and see if they can
come up with the same classification as you!

If your answer is different from your partners, then I

want you to discuss the classification with them,
determine who is right? Are you both right?

CAN YOU GET THE C GRADE? (OBJECTIVE

ASSESSMENT)

Q 10.3 Do this individually (page 259)

Give your answer to a partner, and have them assess the

answer?

How many got at least 6 out of 8 correct?

BREAK-EVEN (CHAPTER 11)

Despite it being a great song by The Script, it is also a very

important concept to management of a firm

What is Break-Even? Write down the definition here

What is the formula?

Where do you think students lose marks from the formula?

EXAMPLE: WE DO IT OURSELVES!
Look at Fluffy Toys
Case Study on page
265 you are not
allowed to turn it
over. Cookie
monster can do this
easily and so can
you! Calculate the
break-even point!

Now turn the page

and see if you are
correct!
Now we shall look
at the table and the
graph ensure you
pay attention to the
information given!

QUESTION TIME

On a postit note, you are to write a break-even question, you

must provide enough information for your partner to calculate
the break-even point using a formula.

Write your answer on the back of the postit note

Now give your postit note to your partner cookie expects

100% of you to be right!!

Question 11.1 do this as pairs (page 276)

WAS THAT A LITTLE EASY? GRADE B/C

QUESTION!
Mr McClurg, my
assistant, will
now give you
some graph
paper! Cookie
wants you to do
Q11.3 a 11.3e!
Good luck! Ha
ha!

A GRADE ANSWERS:
Class discussion: can you think of any limitations of using
break-even analysis?

PAST PAPER QUESTION - DO YOU

UNDERSTAND BREAK-EVEN? JUNE 2010

REMEMBER FOR THURSDAY

Test on Investment Appraisal and Manufacturing Accounts
Revision after school today for those resitting units 1 and 2
good for you!
Revision after school for units 3 and 4 on Thursday after
school!