Tag: Management Accounting

Accounting Multiple Choice Question – 18 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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Contribution by product is an important aspect of costing.

How is it calculated?

Select ONE answer:

  1. income from sales plus fixed costs
  2. income from sales plus variable costs
  3. income from sales minus fixed costs
  4. income from sales minus variable costs

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 – 17 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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Alex plc budgets to produce 110,000 units.

Market research shows that the demand for the product will be for 90,000 units.

The table shows the resources required for the budgeted production, and the available resources for Alex plc.

  • resources required per unit – material 3 kilos + direct labour hours 2.5 + machine hours 0.5
  • resources available – 335,000 kilos + 300,000 labour hours + 110,000 machine hours

What is the principal limiting factor in this case?

Select ONE answer:

  1. direct labour
  2. machine hours
  3. material
  4. sales

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

Accounting Multiple Choice Question – 5 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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The balance sheet of Lucy Ltd shows net assets of £0.5M.

Alex plc buys this business for £0.8M by issuing new share capital.

The fair value of the net assets acquired is £0.7M.

By how much do the net assets of Alex plc increase?

Select ONE answer:

  1. £0.3M
  2. £0.5M
  3. £0.7M
  4. £0.8M

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 – Dr Cash £0.8M Cr SC £0.8M then Dr Assets £0.7M Cr Cash £0.7M – left with Dr Assets £0.7M & Cash £0.1M Cr SC £0.8M

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Accounting Multiple Choice Question – 30 June 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 table shows figures for a week’s production of The Milford.

  • expected production – 10,000 units
  • expected production overhead – £50,000
  • actual production overhead – £60,000
  • under-absorption of overhead – £5,000

What is the actual amount of production in the week of The Milford?

Select ONE answer:

  1. 9,000 units
  2. 9,167 units
  3. 11,000 units
  4. 13,000 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 3

  1. Not correct
  2. Not correct
  3. Correct – £50,000 / 10,000 = £5 per unit = = > Actual production overhead £60,000 means a difference of £10,000 but and under-absorption of £5,000. Therefore £5,000 difference / £5 = 1,000 extra units of actual production.
  4. Not correct

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Accounting Multiple Choice Question – 29 June 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 manufactures a product called The Milford.

Information for the last two years on The Milford is as follows:

Year 1

  • variable unit costs £6.00
  • fixed overheads per annum £24,000
  • unit sales price £10

Year 2

  • variable unit costs £7.00
  • fixed overheads per annum £25,200
  • unit sales price £10

In both years, production of the Milford has been at break-even level.

What is the increase in production in year 2 compared with year 1 of the Milford?

Select ONE answer:

  1. £0.50
  2. £0.83
  3. £1.00
  4. £1.50

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 – Y1 £24k / (£10 – £6) – – > Y2 £25.2k / £10 – £7 = 2,400 extra units
  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.