accno1
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Sooo, there we have it. BM was offered some shoddy re-shredded cotton and MEC as a new customer.

The production matrix turned out to be a false alarm largely and ethical issues surrounded health and safety, sustainable cotton sourcing and money laundering/dodgy financial transactions.

The last pen and paper exam in institute history has been delivered.

What are people’s thoughts? R3 was a nice finisher but I imagine R2 was the time consuming requirement with everyone squeezed for time on R3. I froze for a bit with the calculation but not sure how others did?

Thoughts?
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Mathssss
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R2 calculation was much more difficult than anticipated.. spent a long time on it and still got it wrong - what did you do for it? General consensus is a tough exam I would have thought
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accno1
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(Original post by Mathssss)
R2 calculation was much more difficult than anticipated.. spent a long time on it and still got it wrong - what did you do for it? General consensus is a tough exam I would have thought
I just used 2018 actuals and applied certain percentages. Overall the margins were lower but concluded that because of the relentless increase in CoS, a new base product supplier wouldn’t be a bad thing and was aligned to their corporate ethos.

Then countered with issues surrounding WL credibility in that they were new but the assumption was that they would supply 50% or base products.

I’m just not sure. It was a strange exam but I finished so I’ll be in there but was it enough, I don’t know
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Mathssss
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(Original post by accno1)
I just used 2018 actuals and applied certain percentages. Overall the margins were lower but concluded that because of the relentless increase in CoS, a new base product supplier wouldn’t be a bad thing and was aligned to their corporate ethos.

Then countered with issues surrounding WL credibility in that they were new but the assumption was that they would supply 50% or base products.

I’m just not sure. It was a strange exam but I finished so I’ll be in there but was it enough, I don’t know
There was no price or units information given to work out 2018 figures?
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nikk333
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Thought the calculations requested were really unclear in terms of figures to use. Difficult exam
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accno1
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(Original post by Mathssss)
There was no price or units information given to work out 2018 figures?
I meant draft 2018 management accounts info. Ie the cost of sales
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backtodalab
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So time pressured! I didnt get to finish my R3 properly and did half an exec summary for it. So glad the resit is on PC!
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zzle789
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(Original post by accno1)
I just used 2018 actuals and applied certain percentages. Overall the margins were lower but concluded that because of the relentless increase in CoS, a new base product supplier wouldn’t be a bad thing and was aligned to their corporate ethos.

Then countered with issues surrounding WL credibility in that they were new but the assumption was that they would supply 50% or base products.

I’m just not sure. It was a strange exam but I finished so I’ll be in there but was it enough, I don’t know
Yeah, I also applied the percentages to the 2018 actuals - got a op loss in 19 but a op profit in 2020 due to the efficiency gains - but not sure I did it right due to the rush! Awful exam overall..
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Fonria
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I agree with all these comments. The calculation in R2 was so blatantly an attempt to have a ‘tutor proof’ component to the exam that they ended up having something that was far too ambiguous and needed too much guess work from the candidate.

I’ve spoken to a tutor today who said everyone he’s spoken to found this part horrible.

I thought R1 and R3 weren’t too bad - the danger is though that I spent too long messing about with R2 to do the rest of the exam any justice.

Still finished though - albeit rushed and a bit sloppy.
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MasterLeader
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For R2 it wasn't necessary to have output levels because we were asked to budget overall company performance for 2019 and 2020 so could just adjust 2018 figures based on info given.

I got operating loss of £223k in 2019 and operating profit of £275k I believe but may have remembered incorrectly. Didn't think it was sensible to assume BP cost would be the same for 12 months of 2020 as 9 months of 2019, especially given supplier power from supplying 50% of BP.


For R3, it didn't make sense to me to use 2017 standard cost card, given supplier prices had changed so significantly. In the real world no company is going to use figures from 2017 to budget a 2019 contract.

Instead I made an assumption that selling prices hadn't changed because they hadn't historically and ended up with output of 169,860 I believe.

Option 1 had a better contribution (approx. £14k) (30% markup) but worse margin (20-25%).

Option 2 had a worse contribution (approx. £11k) (50% markup) but better margin (33.3%).


Did anyone else do the same?
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zzle789
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(Original post by MasterLeader)
For R2 it wasn't necessary to have output levels because we were asked to budget overall company performance for 2019 and 2020 so could just adjust 2018 figures based on info given.

I got operating loss of £223k in 2019 and operating profit of £275k I believe but may have remembered incorrectly. Didn't think it was sensible to assume BP cost would be the same for 12 months of 2020 as 9 months of 2019, especially given supplier power from supplying 50% of BP.


For R3, it didn't make sense to me to use 2017 standard cost card, given supplier prices had changed so significantly. In the real world no company is going to use figures from 2017 to budget a 2019 contract.

Instead I made an assumption that selling prices hadn't changed because they hadn't historically and ended up with output of 169,860 I believe.

Option 1 had a better contribution (approx. £14k) (30% markup) but worse margin (20-25%).

Option 2 had a worse contribution (approx. £11k) (50% markup) but better margin (33.3%).


Did anyone else do the same?
Yeah but I used 2017 cost card

Got the same contribution margins, though

Actual contribution lower for option 2 due to smaller variance between selling price and cost, just stripped BP out of cost to do option 2

Figures were slightly different for r2, I think I got 300k profit circa for 2020 - but massively rushed
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Accnuu41
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I couldn’t work out what figures they wanted us to use for r3 and didn’t do any calculation :-( I finished the requirement and talked about the mark up %s but I’m so worried that this has jeopardised my chances. I wish they’d made it clearer. Can any of you reassure me that i’ll be ok? I worked so hard for it I’m so frustrated I didn’t just use 2017 or something like everyone else.
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MasterLeader
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R3 calc is only worth 1 box.

If your narrative was strong you’ll pass easy - only need to pass 5 of the remaining 9 boxes
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MasterLeader
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(Original post by zzle789)
Yeah but I used 2017 cost card

Got the same contribution margins, though

Actual contribution lower for option 2 due to smaller variance between selling price and cost, just stripped BP out of cost to do option 2

Figures were slightly different for r2, I think I got 300k profit circa for 2020 - but massively rushed
I think R3 they have to give credit for using either 2017 cost card OR 2018 actuals on the £50 assumption. It’s too ambiguous.

So for example:

1) Production cost = £40 OR £43
2) Selling Price = £52 OR £55
3) Mark Up of 30%
4) Contribution per unit = £12
.....

That sort of mark scheme ^
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SVR9922
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(Original post by MasterLeader)
For R2 it wasn't necessary to have output levels because we were asked to budget overall company performance for 2019 and 2020 so could just adjust 2018 figures based on info given.

I got operating loss of £223k in 2019 and operating profit of £275k I believe but may have remembered incorrectly. Didn't think it was sensible to assume BP cost would be the same for 12 months of 2020 as 9 months of 2019, especially given supplier power from supplying 50% of BP.


For R3, it didn't make sense to me to use 2017 standard cost card, given supplier prices had changed so significantly. In the real world no company is going to use figures from 2017 to budget a 2019 contract.

Instead I made an assumption that selling prices hadn't changed because they hadn't historically and ended up with output of 169,860 I believe.

Option 1 had a better contribution (approx. £14k) (30% markup) but worse margin (20-25%).

Option 2 had a worse contribution (approx. £11k) (50% markup) but better margin (33.3%).


Did anyone else do the same?
I did the same as you for R 2&3 with exact same results.

I didn't conclude on the exact option though for R3 and simply told them to accept. I'll surely lose my conclusion mark for it.

Did you 'flex' the numbers in R2?
I re-calculated without the economies of scale.
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MasterLeader
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(Original post by SVR9922)
I did the same as you for R 2&3 with exact same results.

I didn't conclude on the exact option though for R3 and simply told them to accept. I'll surely lose my conclusion mark for it.

Did you 'flex' the numbers in R2?
I re-calculated without the economies of scale.
I didn’t have time to be honest, but that will be a separate diamond in one of the first boxes.
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Accnuu41
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I’m pretty sure I’ve failed. I reckon it’ll have seriously impacted two boxes at least and my executive summary and conclusion as I didn’t have figures. I wrote a lot for r3 in terms of other things but the examiners are pretty brutal and I just have to be annoyed with myself for panicking and making a big mistake :-( I don’t know anyone who’s made a mistake that large and got away with it.
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catapult23
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I’m pretty sure I’ve failed as well, because of R3. I misread the proposal (because I thought it was quite ambiguous) and worked out the contribution for the 1,200 units, but then multiplied by 6 because it said they had 5 other cruise ships... stupid

I’m hoping though that because I did the calculation of the contribution for one cruise (just 1,200 units) in my appendix, I can get the marks for that, but that’s probably wishful thinking!

Because I based my financial analysis on the total of 6 cruises rather than just one, I’m really worried I’ve failed R3 and so the whole exam

Plus, in the ethics section, I didn’t mention money laundering and instead mentioned tax avoidance for some reason :/

Overall I thought that exam was a lot harder than it was going to be. Having passed the previous 14 exams first time, I really think I’ve failed case, so now have to wait a long, long time for the resit
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MasterLeader
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I wouldn’t worry about R3 calcs - very easy to skip them and pass, as long as you wrote enough in other areas.

R3 Calc will be 1 mark in the top exec summary box, which is one of the easiest boxes to pass as long as you make other good points.

Conclusion is easy to pass also as long as you made a strategic, financial, operational & ethical point.

Also catapult - calculations boxes typically are generic so your mistake might only lose you one mark and then another mark if you said the revenue is significant (as it’s 6x larger). They’re generic in nature like:

1) 1200 items (you might’ve got that if you wrote 1200 x 6, as you misinterpreted it as 1200 sets of items)
2) Production cost per unit
3) Contribution per unit
Etc...

So (2) and (3) aren’t affected by number of units
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Accnuu41
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(Original post by MasterLeader)
I wouldn’t worry about R3 calcs - very easy to skip them and pass, as long as you wrote enough in other areas.

R3 Calc will be 1 mark in the top exec summary box, which is one of the easiest boxes to pass as long as you make other good points.

Conclusion is easy to pass also as long as you made a strategic, financial, operational & ethical point.

Also catapult - calculations boxes typically are generic so your mistake might only lose you one mark and then another mark if you said the revenue is significant (as it’s 6x larger). They’re generic in nature like:

1) 1200 items (you might’ve got that if you wrote 1200 x 6, as you misinterpreted it as 1200 sets of items)
2) Production cost per unit
3) Contribution per unit
Etc...

So (2) and (3) aren’t affected by number of units
Thanks for your reassurance :-) I’m going to fear the worst I think as it might make it easier to deal with any failure when the results come out if I’ve come to terms with it. I just feel like it could be a big thing to miss unless I’ve done very well in the other boxes. We’ll see!
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