Month: January 2021

The information relates to a product. 

What are the variable unit costs? 

Select ONE answer:

1. £2.00
2. £2.50
3. £4.00
4. £6.00

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

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

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

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – £6,000 / £4 = £1,500 * £10 = £15,000

This work is licensed under a Creative Commons Attribution 4.0 International License.

What does the diagram show?

Select ONE answer:

1. absorption based on actual expenditure and actual activity
2. actual expenditure below budget expenditure
3. actual activity above budget activity
4. actual activity below budget and expenditure as budgeted

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

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

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

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

What will result in under-absorption of fixed production overhead? 

Select ONE answer:

1. absorption based on actual expenditure and actual activity
2. actual expenditure below budget expenditure
3. actual activity above budget activity
4. actual activity below budget and expenditure as budgeted

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

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

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

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

The following information is available for a business.

What is the fixed cost?

Select ONE answer:

1. £1,600
2. £4,000
3. £5,200
4. £5,600

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

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

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

The answer is 3

1. Not correct
2. Not correct
3. Correct – £21,200 – £5,200 = £16,000 / 100 units = £160 vc per unit
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

A business uses job costing to calculate the cost of vehicle repair jobs. 

Overheads are allocated on an absorption costing basis.

What is the effect of this method of allocation?

Select ONE answer:

1. overheads will include both fixed and variable overhead costs
2. overheads will include direct costs only
3. overheads will include fixed overhead costs only
4. overheads will include variable overhead costs only

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

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

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

The answer is 1

1. Correct
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.