Tag: Management Accounting

Accounting Multiple Choice Question – 21 August 2023

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

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Alex plc uses a predetermined direct labour rate of £5.40 per hour to absorb production overhead.

Each unit of product manufactured requires four direct labour hours

The following information is available for a period.

  • actual production overhead – £518,400
  • under-absorbed production overhead – £32,400

What was the actual output of the product in the period?

Select ONE answer:

  1. 22,500 units
  2. 24,000 units
  3. 25,500 units
  4. 30,000 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 1

  1. Correct – £518,400 – £32,400 = £486,000 / £5.4 = 90,000 hours / 4 = 22,500 units
  2. Not correct
  3. Not correct
  4. Not correct

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Accounting Multiple Choice Question – 20 August 2023

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

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Assuming all other factors remain unchanged, the break-even point of a business can be lowered by increasing its?

Select ONE answer:

  1. budgeted sales
  2. fixed costs
  3. marginal costs
  4. selling prices

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

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Accounting Multiple Choice Question – 19 August 2023

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

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The diagram shows a break-even chart.

Which line represents the margin of safety?

Select ONE answer:

  1. WX
  2. WY
  3. XY
  4. XZ

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
  4. Not correct

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Accounting Multiple Choice Question – 7 August 2023

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

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When valuing stocks of finished goods on an absorption cost basis, which costs should be included?

Select ONE answer:

  1. production
  2. production and administration
  3. production, marketing and distribution
  4. production, marketing, administration and distribution

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
  2. Not correct
  3. Not correct
  4. Not correct

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

Accounting Multiple Choice Question – 27 July 2023

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

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Discounting methods have been used to evaluate an investment project over a three year life.

The project will produce annual net inflows of £2M.

£500,000 of the initial investment can be recovered at the end of the third year.

Discount factors at 10 % are:

  • Year 1 – factor 0.91
  • Year 2 – factor 0.83
  • Year 3 – factor 0.75

What is the present value of project cash inflows?

Select ONE answer:

  1. £4.98M
  2. £5.36M
  3. £5.48M
  4. £6.38M

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 – Y1 £2M * 0.91 = £1.82M + Y2 £2M * 0.83 = £1.66M + Y3 £2M * 0.75 = £1.5M + IV £0.5M * 0.75 = £0.375M == > £5.36M
  3. Not correct
  4. Not correct

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