Accounting Multiple Choice Question – 21 December 2023

Alex Manufacturing Ltd has made 1,800 calculators in one month.

Each calculator had a variable cost of £5.40 and a selling price of £11.

The fixed costs for the month were £8,000.

How much contribution did Alex Manufacturing Ltd make in the month?

Select ONE answer:

1. £10,080
2. £19,800
3. £2,080
4. £1,720

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 – Contribution per unit = selling price per unit – variable cost per unit = 11.00 – 5.40 = £5.60 per unit. Total contribution = number of units x contribution per unit = 1,800 x £5.60 = £10,080
2. Not correct
3. Not correct
4. Not correct

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