Workshop 3 – Accounts costs budgets.doc1
You will be organised into teams. Each member chooses one of the tasks. All tasks need to
be completed by the team
Workshop 3 – Basic accounts, cost behaviour & budgets
Task 1
Use a logistics, supply chain or IT example to critically compare the difference between fixed,
variable, direct and indirect costs.
Task 2
A fuel depot has two operatives working varied hours with different rates of pay. The company
pays 12% NI and 3% pension contributions. Use the following information to calculate direct
labour cost.
Operative Hours £/hour
1 8 9.00
2 12 6.00
Task 3
XYZ Logistics Ltd uses 10,000 litres of fuel a month although this varies widely. The following
are extracts from the overhead statement for the transport department showing the make-up
of the budget and actual for March.
Budget
for fuel
Actual
fuel for
March
10,000
litres
11,500
Litres
Indirect Labour
£
£
(i) Fixed 9,000 10,000
(ii) Variable 11,000 11,600
Consumable
(variable)
16,000 15,250
Variable
overheads
21,000 19,200
Fixed overheads 21,000 22,000
Show two budgetary control statements for March,
(a) One based on the fixed budget for 10,000 litres, and
(b) One based on a flexible budget for the actual usage.
M22AAE Logistics Economics
Workshop 3 – Accounts costs budgets.doc
2
Deliverables:
Using flipchart paper or slides/word processor for the reflection and list:
? Your answers to each of the tasks
? Any assumptions you have made
? Justify your responses with referenced evidence
Groups should expect their findings and outputs to be peer reviewed at least once by
the end of the semester
Hints & tips:
Let’s keep it simple.
For the purposes of this exercise, if you find that you are getting into lengthy discussions on
certain points, please use an “Assumptions parking lot”
PHOTOGRAPH OR SCAN YOUR FINAL NOTES, OR INPUT TO A WORD PROCESSING
DOCUMENT AND POST IT IN THE WORKSHOP AREA ON MOODLE
DO NOT FORGET TO INCLUDE YOUR GROUP MEMBER’S NAMES ON YOUR CONTENT!
RECORD YOUR FINDINGS FROM THIS ACTIVITY IN THE WORKSHOP AREA IN
MOODLE