The Multiple Choice Questions Blog

The details of direct labour costs are as follows:

1. budget – 48,250 hours at £6.50 per hour
2. actual – 50,000 hours at £7.00 per hour

What is the direct labour rate variance?

Select ONE answer:

1. £4,700 adverse
2. £24,000 adverse
3. £24,000 favourable
4. £28,700 adverse

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 – 50,000 hours * (£7.00 – £6.50) ==> £25,000 adverse
4. Not correct

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A company has a standard selling price of £12 per unit and budgeted sales of 80,000 units.

It has actual sales of 82,000 units with a total sales value of £955,300.

What is the sales price variance?

Select ONE answer:

1. £4,700 adverse
2. £24,000 adverse
3. £24,000 favourable
4. £28,700 adverse

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 – £955,300 / 82,000 = £11.65 ==> £12.00 – £11.65 = £0.35 * 82,000 ==> £28,700 ADV

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

A company’s debtors total £27,000.

There is a collection period of 30 days.

The budget for the coming year provides for an increased turnover of 50 % with the relevant collection period being increased to 60 days.

What will the year-end debtors be?

Select ONE answer:

1. £81,000
2. £54,000
3. £40,500
4. £36,000

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 – £27k *1.5 * 2
2. Not correct
3. Not correct
4. Not correct

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

Which of the following is an advantage of using a budgetary control system?

Select ONE answer:

1. calculation of bad debt provisions
2. calculation of depreciation
3. making ‘make or buy’ decisions
4. monitoring management performance

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.

Which of the following should be considered by a manufacturer before deciding to buy-in its products instead of manufacturing them?

Select ONE answer:

1. administration expenses
2. alternative use of resources formerly used for production
3. contribution to sales ratio
4. marketing expenditure

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. Correct
3. Not correct
4. Not correct

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