Accounting Multiple Choice Question – 29 August 2022

A company makes 500 units and sells these units at £50 each.

The direct materials cost is £7,500, direct labour costs £2,500 and fixed overheads are £8,400.

How much profit will be made if the company increases the number of units to 600?

Select ONE answer:

1. £7,920
2. £9,600
3. £10,100
4. £11,600

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 2

1. Not correct
2. Correct – 500 * £60 = £30,000 – (600 * £20 TVC) – £8,400 ==> £9,600
3. Not correct
4. Not correct

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