Tag: Cambridge Assessment

Alex plc manufactures 175 units of a product a month.

The following total information is available for the month:

sales income – £580k
variable costs – £230k
fixed overheads – £90k

What is the break-even point in units?

Select ONE answer:

1. 45 units
2. 49 units
3. 61 units
4. 88 units

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 – 90,000 / ((580,000 – 230,000)/175)
2. Not correct
3. Not correct
4. Not correct

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Existing fixed overheads are £100,000, unit selling price is £10 and unit variable costs are £5.

Fixed overheads are expected to increase by £20 000.

What is the new break-even sales volume?

Select ONE answer:

1. 10 000 units
2. 12 000 units
3. 20 000 units
4. 24 000 units

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 == > £100k + £20k / (£10 – £5) = 24,000 units

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Alex plc’s Income Statement showed a profit before interest of £128,000.

Interest paid was £8,000.

The table shows amounts included in the company’s SOFP:

• Non-current assets £485,000
• Net current assets £27,000
• Liability amounts falling due after one year: Debentures £80,000

How much is the return on the total capital employed?

Select ONE answer:

1. 20.3%
2. 21.6%
3. 23.4%
4. 25.0%

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 == > £128k / (485 + 27 – 80 + 80) = 25%

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

The following data is available for Alex plc:

Credit sales — > This Year £60,000  & Last Year £50,000

Credit purchases — > This Year £40,000  & Last Year £28,000

Trade receivables (average) — > This Year £12,000  & Last Year £8,000

Trade payables (average) — > This Year £10,000  & Last Year £16,000

Which statement is correct?

Select ONE answer:

1. Trade receivables and trade payables days ratios have improved.
2. Trade receivables and trade payables days ratios have worsened.
3. Trade receivables are paying faster, but trade payables are being paid more slowly.
4. Trade receivables are paying more slowly, but trade payables are being paid faster.

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.