Accounting Multiple Choice Question – 20 November 2017

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

The following information is available for the single product manufactured by a business.

Table 17

How many units must the business sell to produce an annual profit of £80 000?

Select ONE answer:

  1. 7,477 units
  2. 14,036 units
  3. 15,888 units
  4. 29,825 units
  5. 38,555 units

Show your workings to arrive at your answer, and explain and justify your reasons:
……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This is multiple choice question is suitable for Accounting KS5 classes.

The answer is 3 – The contribution per unit is £10.70. If you multiply it by 15,888 units the contribution is £170,001.60 which if you take away the £90,000 of fixed costs leaves you with an annual profit of £80,000. The budgeted production information is a distraction.

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