Example of reports

1. Write a brief report for non-finance staff containing:

 a brief introduction outlining the areas you will be covering in the report
 an explanation of what a fixed cost is, giving an example
 an explanation of what a variable cost is, giving an example
 a description of what happens to the unit cost as output increases and the reason for this.
Introduction
This report:
 explains and gives examples of fixed and variable costs
 Describes the effect of increased output on unit cost.
Fixed cost
A fixed cost is one that remains the same irrespective of the level of output. An example of a fixed
cost for a factory would be the cost of rent.
Variable cost
A variable cost is one which changes in relation to the level of output. An example of a variable
production cost would be the direct materials used in a product.
Description of what happens to the cost per unit as output increases
The cost per unit decreases as output increases. This is because fixed costs do not change with
output so are shared between an increased number of units when output increases.

2. Write a brief report for non-finance staff containing:

 a brief introduction outlining the areas you will be covering in the report
 an explanation of what a time rate pay is, giving an example
 an explanation of what a piece work is, giving an example
 a descriptions of other types of pay to be considered when making payments to employees
Introduction
This report will cover an explanation of labour cost with Company Bla Bla.
Time-rate pay
Time-rate pay is based on the number of hours worked. For example if an employee worked 37 hours
a week with an hourly rate of £8.00, pay for the week would be £296.
Piecework
Piecework is payments per unit produced. For example employees in a factory are paid for each item
they make. If an employee gets paid £0.95 per unit produced and they produced 300 units per week ,
total pay will be £285.
Other types of pay
Other types of pay include overtime when an employee works over the standard weekly hours, they
may be paid a higher overtime rate for hours over and above the standard working weekly hours.
Some businesses will pay bonus if employees meet certain targets. His is an additional payment on
top of their usual pay.
 3. Write a short report for non-finance staff containing:
 A brief introduction outlining the areas you will be covering in the report
 An explanation of how LIFO and FIFO are valued (at oldest or most recent purchase prices)
 An explanation of how closing inventory is valued for LIFO and FIFO
 A description of how AVCO is calculated
Introduction
This report will cover an explanation of the three different methods of inventory valuation. Because
the price of items changes day to day, this affects the valuation of both issued and closing inventory.
When issuing inventory using FIFO (First in first out) inventory is issued using the oldest purchase
price. Therefore items left are valued at the most recent purchase price and the closing inventory is
valued at the most recent purchase price.
When issuing inventory using LIFO (last in first out) inventory is issued using the most recent
purchase price. Therefore items left are valued at the oldest purchase price and the closing inventory
is valued at the oldest purchase price.
AVCO (average cost) is calculated by using the following formula:
Total cost of goods held/number of items held
His gives an average cost of the inventory held.

4. Write a short report for non-finance staff containing:

 A brief introduction outlining the areas you will be covering in the report
 An explanation of the difference between raw materials and work in progress with an example
 An explanation of the difference between the direct cost and the manufacturing cost
 A description of how direct material is calculated
Introduction
This report will cover an explanation of the manufacturing in account format.
Raw materials are the part used to produce a product. For example the piece of wood used to make
cabinets. When the cabinets are partially completed this is known as work in progress because the
cabinets are not ready to be sold.
Direct costs are the costs that can be directly indentified with the units of output. This is made up of
materials and labour. The manufacturing cost is made up of the direct costs plus any manufacturing
overheads.
Direct material is calculated as follows: opening inventory of raw materials plus materials purchased,
minus closing inventory of raw materials
 5. Write a short report for non-finance staff containing:
 A brief introduction outlining the areas you will be covering in the report
 An explanation of what overheads are, giving an example
 An explanation of what an overhead absorption rate is
Introduction
This report will cover an explanation of overheads and overheads absorptions rates.
An overhead is not directly related to the products being manufactured. There these are non-
production cost known as indirect costs. For example rent paid on premises.
The overhead absorption rate is the cost of overheads charged to the cost units which pass through
a specific department. For example with machine hours, an element of overheads will be charged to
machine hours. With labour hours an element of overheads will be charged to labour hours.

6. Write a short report for non-finance staff containing:

 A brief introduction outlining the areas you will be covering in the report
 An explanation of two possible reasons why the purchase ledger control account could be
higher than the balance of the purchase ledger accounts in relation with purchase invoices and
purchase returns
 An explanation of two possible reasons why the purchase ledger control account could be
lower than the balance of the purchase ledger accounts in relation to purchase invoices and
purchase returns.
 An explanation as to why it is beneficial to complete control accounts reconciliations.

This report is highlighting reasons as to discrepancies between the closing balance on the purchase
ledger control accounts (PLCA) and the closing balance of all the purchase ledger (PL) accounts.

Reasons for what the purchase ledger control account will be higher than the balance of the purchase
ledger accounts include: purchase invoices could have been understated in the purchase ledger or
entered twice or overstated in the PLCA. Purchases returns could have been omitted or understated
in the PLCA or entered twice or overstated in PL.

Reasons why the purchase ledger control account could be lower than the balance of the purchase
ledger accounts include: purchase invoices could have been omitted in the PLCA or entered twice or
overstated in the purchase ledger. Purchase returns could have been omitted or understated in the
purchase ledger or entered twice or overstated in PLCA.

It is beneficial to complete control account reconciliations because it identifies any errors and can
reduce fraud.