Accounting Multiple Choice Question – 17 November 2021

You are given the following information concerning a product:

• selling price — £10.00
• Variable labour costs — £3.50
• Raw material costs — £2.50
• Break-even point — 2,500 units

What is the total fixed cost?

Select ONE answer:

1. £10,000
2. £15,000
3. £16,250
4. £18,750

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 ==> (£10 – £3.5 – £2.5) = £4 * 2,500 = £10,000
2. Not correct
3. Not correct
4. Not correct

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