profit from operations 98 000

equity at the end of the year 500 000

profit for the year 91 000
long-term bank loan 150 000
equity at the end of the year 500 000
What is the return on capital employed?
long-term bank loan 150 000

ABSORBTION  
A 14%
COSTING  
B 15.08%
What is the return on capital employed?
C 18.2% D 19.6%

Q1.  
A 14% B 15.08% C 18.2% D 19.6%
22 A business provided the following information.

budgeted
22 A business provided the followingoverheads
information. $20 000
budgeted direct labour9 hours 2000
budgeted overheads $20 000
direct labour
24 The following inventory transactions are rate $20 per hour
available for a business.
budgeted direct labour hours 2000
A job used materials costing $45 and
direct labour 6 hours of direct labour.
rate $20 per hour
opening inventory on 1 January 16 items at $525 each
Overheads are receipts
chargedonon the basis of direct labour
3 January hours used.
A job used materials costing $45 and 6 hours of24 items
direct at $675
labour. each
issues
What was the cost of on
the5job
January
before adding any28 items
profit?
Overheads are charged on the basis of direct labour hours used.
The business
A $165 uses theBAVCO method to valueCinventory.
$175 $180 D $225
What was the cost of the job before adding any profit?
 
What was
(Nov   16  /the value of closing inventory on 7 January?
13/Q22)  
A $165 B $175 C $180 D $225
  A $6300 B overhead
$7200 absorptionC $7380 D $8100
23 What is a reason for in a manufacturing business?
Q2.  
23 A
What toiscontrol
a reasonoverhead expenditure
25 A business enteredforintooverhead
a contractabsorption in a of
for the support manufacturing business?
its computer systems. There was an annual
fee of $5000 plus a charge of $30 per hour for
B to determine the net realisable value of inventory solving computer problems. At the end of the year
A cost
the to control overhead
of computer supportexpenditure
totalled $11 330.
C to enable overheads to be apportioned to cost centres
B totype
Which determine the net
of cost was this?realisable value of inventory
D
C to to establish costs pertounit
enable overheads be of product to cost centres
apportioned
A fixed
D
B to establish costs per unit of product
semi-variable
C stepped  
(Nov  16  /13/Q23)  
  D variable
Q3.  
26 A business absorbs overheads on the basis of direct labour hours. The following information is
available.
© UCLES 2016 9706/13/O/N/16

© UCLES 2016 budgeted labour hours 6600 hours

9706/13/O/N/16

actual labour hours 7100 hours

budgeted overheads $75 900
actual overheads $74 250

What is the value of overheads over or under absorbed?

A $5625 over
B $5625 under
C $7400 over
D $7400 under
 
 
(Nov  16  /13/Q26)  
 
 
 

 
© UCLES 2016 9706/13/O/N/16 [Turn over
 10

27 A manufacturing business has two production departments: assembly and painting.

The following information is available.

assembly painting
Q4.   10
  machinery at net book value ($) 150 000 100 000
27 A manufacturing businessrepair
machinery has two production
costs ($) departments: assembly and painting.
14 000 6 000
machine operating
The following information hours
is available. 60 000 15 000
number of machines assembly 30 painting 10

The total machinery insurance

machinery costvalue
at net book for the
($)year was
150$5000.
000 100 000
machinery
How much insurance repair be
should costs ($)
apportioned 14 000
to the assembly 6 000
department?
machine operating hours 60 000 15 000
A $3000 B $3500 C $3750 D $4000
number of machines 30 10

The total machinery insurance cost for the year was $5000.
28 Which costs will change with an increase in activity?
How much insurance should be apportioned to the assembly department?
A unit fixed costs and total fixed costs
A $3000 B $3500 C $3750 D $4000
B unit fixed costs and total variable costs  
  C unit fixed costs and unit variable costs
28 (Nov  
Which1costs
6  /13/Q27)  
will change with an increase in activity?
  D unit variable costs and total variable costs
A unit fixed costs and total fixed costs
Q5.  
B unit
29 The tablefixed costs
shows and total
figures variable
for a week’scosts
production.
C unit fixed costs and unit variable costs
D expected
unit variable costs and totalproduction
variable costs 10 000 units
expected production overheads $50 000
29 The table shows figures for aproduction
actual week’s production.
overheads $60 000
under absorption of overheads $5 000
expected production 10 000 units
What is the actual amount
expectedofproduction
productionoverheads
in the week? $50 000

A 9000 units actual

B 9167production
units overheads
C 11 000 units D$60 13
000000 units
under absorption of overheads $5 000
 
(Nov  
What 1
is6  
the /13/Q29)  
actual amount of production in the week?
  9
A 9000 units
Q6.   B 9167 units C 11 000 units D 13 000 units

25 In a manufacturing business the following could occur.

1 Actual overheads paid are less than budgeted overheads.

2 Actual overheads paid are more than budgeted overheads.
3 Actual units produced are less than budgeted units.
4 Actual units produced are more than budgeted units.
© UCLES 2016 9706/13/O/N/16
Which situations would result in an under absorption of overhead expenditure?

1 and 3 1 and 4 2 and 3 2 and 4

 
A B C D
 
© UCLES 2016 9706/13/O/N/16

26 (Nov   16  /12/Q25)  
A company makes and sells a single product for $12 per batch.

The variable cost is $4 per batch.

  Fixed costs have been absorbed based on a normal activity level of 1000 batches at
$3 per batch.

What is the profit under marginal costing if the company makes and sells 1500 batches?
 company 3 uses absorption costing
company 4 uses marginal costing

The investor wishes to invest in companies with the best underlying profitability.

Which companies should he select?

Q7.   8
  A 1 and 3 B 1 and 4 C 2 and 3 D 2 and 4
23 A manufacturer operates a bonus system. He provides the following information.

25 A company is classifying its costs.

output required It discovers
from each worker thatunits
175 for any level of output between 10 000 and
15 000 units the freight cost per
time allowed unit is output
to complete always the same
10.5 hoursfigure of $2 per unit.
actual
Of which type of cost istime
thisworked by Fred
an example? 7 hours

A bonus is paid of 25% of the labour costs for time saved, in addition to the hourly rate of $8.75.
A fixed cost
What did Fred earn for his output of 175 units?
B semi-variable cost
A $68.91 B $76.56 C $91.88 D $99.53
C stepped fixed cost  
(Nov  variable
24 ADpotential
16  /investor
11/Q23)  
costlooks at the financial statements of four companies. Their income statements
  all show the same level of revenue and profit from operations. The cost of purchasing inventory is
Q8.  
increasing.

26 When does under

company absorption
1 uses of overheads
AVCO to value inventory occur?
company 2 uses FIFO to value inventory
1 Actual expenditure is less than budgeted.
company 3 uses absorption costing
2 Actual expenditure is more than budgeted.
company 4 uses marginal costing
3 Production is lower than planned.
The investor wishes to invest in companies with the best underlying profitability.
4 Production is higher than planned.
Which companies should he select?

A 1 1and
A and
3 3 B 1Band 1
4 and 4 C 2 andC3 2 and
D 32 and 4 D 2 and 4
 
 
25 (Nov  
A company is classifying its costs. It discovers that for any level of output between 10 000 and
16  /11/Q26)  
© UCLES 2016 9706/11/O/N/16
15 000 units the freight cost per unit is always the same figure of $2 per unit.
 
Q9.  
Of which type of cost is this an example?
9
  A fixed cost
27 The following information is available in respect of department 1.
B semi-variable cost
C stepped fixed cost actual forecast
D variabledirect
cost labour hours 45 000 40 000
machine hours 12 000 10 000
26 When does under absorption of overheads occur?
overheads to be apportioned to department 1 $90 000
1 Actual expenditure is less than budgeted.
The company has been asked to quote for an order. The expected time taken in department 1 will
2 Actual
be four direct expenditure
labour hours andisseven
more machine
than budgeted.
hours.
3 Production is lower than planned.
How much overhead should be charged to the order as it passes through department 1?
4 Production is higher than planned.
A $8.00 B $9.00 C $52.50 D $63.00
A 1 and 3 B 1 and 4 C 2 and 3 D 2 and 4  
 
28 A business manufactures a single product. The following information is available.
(Nov  
© UCLES 201616  /11/Q27)   9706/11/O/N/16

  estimated
  this year
next year
$
  $
  selling price per unit 25 25
variable cost per unit 15 17
total fixed costs 80 000 84 000
 
profit for the year 20 000

How many units must be sold to achieve the same profit next year?
 Q10.  
10
 
26 A business incurs the following costs.

1 direct material and direct labour costs

2 indirect factory production overheads
10
3 administrative expenses
26 A business incurs the following costs.
4 distribution costs
1 direct material and direct labour costs
Which costs are included in the cost per unit using absorption costing?
2 indirect factory production overheads
A 1, 2, 3 and 4 B 1 and 2 only C 1 only D 2, 3 and 4 only
3 administrative expenses  
  4 distribution costs
 
27 A company absorbs overheads using machine hours. The following information is available.
Which costs
(June   16  /are included in the cost per unit using absorption costing?
13/Q26)  
 A 1, 2, 3 and 4 B 1 and 2 only overheads C 1 only machine
D hours
2, 3 and 4 only
Q11.   budgeted $200 000 40 000 hours
 
actual using machine
27 A company absorbs overheads $240 000 60following
hours. The 000 hoursinformation is available.

What was the over or under absorption of overheads?

overheads machine hours
A $40 000 over
8
budgeted $200 000 40 000 hours
23 B $40 000was
A business under
started on 1 January. The purchases and sales of inventory for January were as
actual $240 000 60 000 hours
follows.
C $60 000 over
What was the over or under absorption of overheads?
D $60 000 under date purchases sales
A $40 000 over
4 January 3 at $200 each –
28 BHow$40 000 under
is margin of safety calculated?
13 January – 2 at $400 each
CA $60 000sales
actual over minus
26break-even
January sales
3 at $250 each –
DB $60 000sales
actual underminus
28budgeted
January sales – 2 at $400 each
C actual sales minus cost of sales
 
  The business used the first in first out (FIFO) method of inventory valuation.
28 How is margin of safety calculated?
(June   16  /13/Q27)  
D budgeted sales minus cost of sales
 A actual sales minus break-even sales
What was the gross profit for January?

29 Q12.  
BAA company
actual incurs
$250 sales total
minus costs
$650 of sales
B budgeted $2200 C
for producing
$700 100 units and $4600
D $750 for 300 units. The
selling price per unit is $20.
 C actual sales minus cost of sales
24 What is the total
A manager profit or loss
is preparing at a production
a quotation for Job level
88. Aofspecialised
200 units? technician is hired to work for this
Djob budgeted
only. He will sales
useminus cost of
machinery sales
that the company already owns.
A $400 loss
Which statement is correct about expenses for Job 88?
29 AB company incurs total costs of $2200 for producing 100 units and $4600 for 300 units. The
$600 profit
selling
A Both price per unit isdepreciation
machinery $20. and technician wage are direct.
C $933 profit
What
B Bothis themachinery
D $1600 total profitdepreciation
profit or loss at a production levelwage
and technician of 200 units?
are indirect.

AC $400 loss depreciation is direct and technician wage is indirect.

Machinery

BD $600 profit depreciation is indirect and technician wage is direct.

Machinery
 
(June  16  
C 2016
© UCLES $933 /12/Q24)  
profit 9706/13/M/J/16
25   Budgeted overhead expenditure was $180 000 and budgeted labour hours were 12 000. Actual
Doverheads
$1600 profit
 
amounted to $196 000 and actual labour hours were 12 200.

  What was the under or over absorption of overheads?

  A $3000 over
© UCLES 2016 9706/13/M/J/16
B $3000 under
  C $13 000 over
D $13 000 under
 A Both machinery depreciation and technician wage are direct.
B Both machinery depreciation and technician wage are indirect.
C Machinery depreciation is direct and technician wage is indirect.
D Machinery depreciation is indirect and technician wage is direct.

Q13.  
25 Budgeted overhead expenditure was $180 000 and budgeted labour hours were 12 000. Actual
overheads amounted to $196 000 and actual labour hours were 12 200.

What was the under or over absorption of overheads?

A $3000 over
B $3000 under
C $13 000 over
D $13 000 under
 
26  Why might a business use marginal costing?
(June  16  /12/Q25)  
  1 to calculate break-even units
  8
2 to decide on the most profitable use of limited resources
Q14.   3 to decide whether to make a product or buy it
23 A production centre uses 20 000 machine hours and 17 000 labour hours each month.
A 1 and 2 only B 1, 2 and 3 C 2 only D 3 only
Which formula is used to calculate the overhead absorption rate?

A total machine hours 8

total overhead cost
23UCLES
© A production
2016 centre uses 20 000 machine9706/12/M/J/16
hours and 17 000 labour hours each month.
total overhead cost
BWhich formula
total is used
labour to calculate the overhead absorption rate?
hours
A total machine hours
total overhead cost
C total overhead cost
total (labour hours + machine hours) ÷ 2
B total overhead cost
total
totaloverhead cost
labour hours
D
total machine hours
total overhead cost
C
total (labour hours + machine hours) ÷ 2
 
 
(March  
24 The total1 6  /information
overhead
D following 12/Q23)  
cost is available.
  total machine hours
Q15.   budget actual
24 The following information is available.
overheads $60 000 $66 000
direct labour budget
30 000 hours actual
35 000 hours
overheads $60 000 $66 000
The overhead absorption rate is based on direct labour hours.
direct labour 30 000 hours 35 000 hours
What is the amount of overhead over-absorbed or under-absorbed?
The overhead absorption rate is based on direct labour hours.
A $4000 over
What is the amount of overhead over-absorbed or under-absorbed?
BA $4000 under
$4000 over
CB $6000 over
$4000 under

DC $6000 under
$6000 over
D $6000 under  
 
25 A particular cost is classified as ‘semi-variable’.
(March  16  /12/Q24)  
25 A particular cost is classified as ‘semi-variable’.
 
What effect will a 20% reduction in activity have on the unit cost?
  What effect will a 20% reduction in activity have on the unit cost?
A decrease by 20%
A decrease by 20%
BB decrease by less than 20%
  decrease by less than 20%
CC increase by20%
increase by 20%
DD increase byless
increase by lessthan
than 20%
20%
 10
Q16.  
29 A business has the following budgeted and actual results for a period.

budgeted fixed overheads 354 000

actual fixed overheads 360 000
under-absorption of overheads 3 000

The fixed overheads are absorbed per unit.

The budgeted number of units were 118 000.

What is the actual level of activity in units?

9

A 118 000 B 119 000

24 A customer places an order for 20 000 bricks.
C 120 000 D 121 000
Which costing method will the supplier use to price the order?  
 
What
30 (March  are1the
A batch main purposes of budgeting?
6  /12/Q29)  
  B job
1 to control expenditure
  C marginal 10
Q17.   2 to forecast future expenditure
D unit
29 A trader received an order for 1000 shirts, 500 units printed in red and 500 units in blue. The
3 to had
printing machine determine
to be setcompany strategy
up two times. The relevant cost information is shown.
25 Which item is classed as a direct cost?
A 1, 2 and 3 B 1 and 2 only C 1 only D 2 only
variable costs per unit $20
A administration costs
factory overhead 200% of unit variable cost
B carriage inwards
C
machine setup per batch
carriage outwards
$1000

D supervisor’s
What salary
is the unit cost of this order?

A $60 B $61 C $62 D $66

26 A business sells its product for $50 a unit and has variable costs of $30 per unit. Its fixed costs for  
  this year were $200 000. Next year, fixed costs are expected to be $260 000.
30 (Nov   15  /13/Q29)  
A business started on 1 January 2014. The following balances are available at
 
How
31 many more
December units will have to be sold next year to make the same profit as this year?
2014.

  A 3000 B 5200 C 10 000 D 13 000

Q18.  
$

27 A manufacturer produces 100 000 totaltins

sales
of paint with a150 000direct materials cost of $300 000.
total
Direct labour is 2000 hours at a cost of $400 000, and overheads are absorbed at the rate of $100
cash purchases 72 000
per direct labour hour.
cash expenses 32 000
What is the cost of a tin of paint?
depreciation 4 000
A $3 B $5 C $7 D $9
trade receivables 18 000  
(Nov15/12/Q27)  
  A business
28 What is theprovides the following
cash surplus information.
for the year?
  A $24 000 B $28 000 C $42
number of 000 total overheads
D $46 000
  month
machine hours $
 
 
August 72 000 842 000

  September 84 000 938 000

  The variable overhead rate per machine hour was $8.

© UCLES 2016
What was the monthly fixed cost? 9706/12/F/M/16
  A $96 000 B $266 000 C $576 000 D $672 000
 A $8000 higher
B $8000 lower
C $12 000 higher

 
D $12 000 lower

Q19.  
30 A business provides the following information for a cost centre.

apportioned overhead costs $160 000

re-apportioned service department costs $60 000
total labour hours 25 000
total machine hours 9 40 000

Whichis
26 What line represents
the overheadtotal cost?
absorption rate for the cost centre?

A $4.00 per hour Z

B $5.50 per hour break-even

point
C $6.40 per hour Y

D $8.80 per hour $

M X  
  W
 
(Nov15/12/Q30)  
  O
units
 
Q20.  
A OW B OZ C MX D MY
 
27 A company makes one product with a selling price of $384 per unit. Costs are as follows.

per unit

direct materials 4 kilos at $8 per kilo

direct labour 8 hours at $12 per hour
© UCLES 2015 9706/12/O/N/15
selling and distribution $40

The mark up is 50%.

What is the factory overhead absorption rate per labour hour?

 
A $3 B $5 C $11 D $22

 
28 (Nov15/11/Q27)  
A business provides the following information for August.
 
Q21.  
9 $

actual revenue
24 Which cost relating to a manufacturing 340 000
business is apportioned between its cost centres?
break-even revenue 370 000
A depreciation of delivery vehicles
forecast revenue 365 000
B factory power
What was its margin
C finance costs of safety in August?
AD +$25 000 B –$25 000 C +$30 000 D –$30 000
 
raw materials
 
25 (June15/13/Q24)  
A company absorbs overheads on the basis of machine hours, which are budgeted at 11 250.
The budgeted overhead is $281 250.

  Results show actual hours of 10 980 and overhead of $276 652.

What is the under or over absorption?
© UCLES 2015 9706/11/O/N/15 [Turn over
24 Which cost relating to a manufacturing business is apportioned between its cost centres?

A depreciation of delivery vehicles

B factory power
10
C finance costs
A manufacturing
27 D raw materialscompany produces 10 000 units and sells 8000 units in a year.
 
Q22.  
The selling price per unit is $30.
25 A company absorbs overheads on the basis of machine hours, which are budgeted at 11 250.
Total costs incurred during that year were as follows.
The budgeted overhead is $281 250.

$ 652.
Results show actual hours of 10 980 and overhead of $276
direct materials
What is the under or over absorption? 50 000
direct labour 80 000
A $2152 over absorbed
prime cost 130 000
B $2152 under absorbed
factory overhead 50 000
C $4598 over absorbed
production cost 180 000
 
D $4598 under absorbed
administration cost 65 000
  total costs 10 245 000
26   A manufacturing company uses the reducing balance method to calculate depreciation.
23 (June15/13/Q25)  
The company
The diagram shows a break-even
uses absorption chart.
costing.
What describes the depreciation expense?
  What is the value of closing inventory?
  A fixed cost $
Q23.  
A
B $26 000
semi-variable B
cost $36 000 C $49 000 D $60 000

  C stepped cost
Y
28 The following information is available for a manufacturing company.
D variable cost

budgeted direct labour hours 26 200

X direct labour hours
actual 28 000
budgeted overhead costs $166 500
0 overheadnumber
actual costs of units $172 600

What
What is
is the overhead
indicated by absorption rate?
the line XY?
A
A $5.95
total costs B $6.16 C $6.35 D $6.59

B total fixed costs  

 
(June15/13/Q28)  
C total sales

  D total variable costs

Q24.  
24 The following figures are given for a factory’s overheads and machine hours worked.

overhead
machine hours total overhead costs
absorption rate
© UCLES 2015 9706/13/M/J/15 [Turn over
budgeted 122 000 $268 400 $2.20
actual 116 000 $261 000 $2.25

What was the under or over absorption of overhead for the quarter?
© UCLES 2015 9706/13/M/J/15

A $5800 over absorbed

B $5800 under absorbed
C $7400 over absorbed
D $7400 under absorbed
 
 
25
(June15/12/Q24)  
Which costing method is used to calculate a break-even point?

A absorption
B batch
 
C marginal
D unit
 4 variable cost per unit
1 fixed cost per unit
8
A 1 and
2 2 total fixed 2 and 3
B cost C 2 and 4 D 3 and 4
22 X Limited and Y Limited both started trading on 1 January 2001.
3 total variable cost
25 A business has an activity level below budget and fixed overhead expenditure below budget.
Each year,
4 both businesses
variable unit a profit from operations of $20 000.
cost perhad
  Do these result in an under absorption of fixed overhead?
Q25.  
AOn 131and
December
2 2013
B retained
2 and 3 earnings C were as 4follows: D 3 and 4
2 and
activity below expenditure below
  budget budget $
25 A business has an activity level below budget and fixed overhead expenditure below budget.
A no no
X Limited 145 000
Do Bthese result no
in an under absorption
yes of fixed overhead?
Y Limited 95 000
C yesbelow
activity no
expenditure below
Which
D statement
budget
yes explains the difference?
budget
yes
AA X Limited no
has transferred higher
noamounts to general reserve.
26 A
BBtrader decidesno
X Limited to manufacture
pays a product
yesperrather
a higher dividend than buy it from a supplier.
share.
Which
CC Y statement about
Limitedyes
has theshares
fewer buying-in price
no is correct?
in issue.
DD ItYisLimited
A more than
hasfixed
yes cost of
a higher producing
level debt.the product
ofyes  
  B It is more than semi-variable cost of making the product
23 (June15/11/Q25)  
26 Who
AC It will
trader be most
is decides
more tointerested
than cost ofinmaking
manufacture
total aabusiness
product maximising
rather
the product its profitability?
than buy it from a supplier.
 
Q26.  
A Itcustomers
D
Which is more thanabout
statement variable
the cost of producing
buying-in price isthe product
correct?
 AB Itgeneral
is morepublic
than fixed cost of producing the product
27 A company has been asked to quote a price for a specific job. Estimated costs are as follows.
BC Itinvestors
is more than semi-variable cost of making the product
$
CD Itsuppliers
is more than total cost of making the product
direct materials 2000
D It is more than variable cost of producing the product
24 A company’s sales revenue has direct labour
increased 3300 in a period, but its gross profit has only
by 40%
increased by 30%.
27 AOverheads
company are
hascharged
been asked to quote
at 50% a price
of labour cost. for a specific job. Estimated costs are as follows.
Which factors could explain this?
Profit is 20% of the total job cost. $
1 a decrease in the cost of sales
What is the total of the quotation for the job?
direct materials 2000
2 a decrease in selling price per unit
A $5300 B $6360 direct C $6950
labour 3300D $8340  
  3 an increase in administration expenses
(June15/11/Q27)  
© UCLES Overheads
2015 are charged at 50% of labour
4 an increase in purchase price
cost.
9706/11/M/J/15
per unit [Turn over
 
Q27.  
Profit is 20% of the total job cost.
A 1 and 2 B 2 and 3 C 2 and 4 D 3 and 4
 What is the total of the quotation for the job?
25 AWhat will cause under-absorption
$5300 B $6360 of fixed
C production
$6950 overheads?
D $8340
A absorption of overheads is based on actual expenditure and actual activity
© UCLES 2015 9706/11/M/J/15 [Turn over
B actual activity is above budgeted activity
C actual activity is below budgeted activity and actual expenditure is as budgeted
D actual expenditure on overheads is below budget expenditure

 
(Nov14/12/Q25)  
 
© UCLES 2014 9706/12/O/N/14

 
 
 
 

 
 25 What does the line betweenvariable
points Xoverhead 3
and Y on the break-even chart represent?
fixed overhead 4
X
profit 21

What is the marginal cost per unit?

Y
Q28.  
A $13 B $
$16 C $20 D $25
  revenues
and costs
29 A business hires machinery at a cost of $700 per machine per month. Each machine can produce
1000 units a month. A maximum of 10 machines can fit into the factory. The factory rent is $4900
per month. Other costs amount to $2 per unit.

What is the unit cost if 8500 units are produced in a month?

0 units
A $3.19 B $3.23 C $3.28 D $3.32
A total costs  
  B total gross profit
(Nov14/12/Q29)  
 
C total profit for the year

Q29.  
D total variable costs
 
26 Extracts from the costing records of a builder who has completed two houses are shown.

11 $
© UCLES 2014 9706/12/O/N/14 [Turn over
building inspection fees 2 000
28 A business provides the following information about a product.
land (four plots) 100 000
labour $
160 000
materials
variableused
cost per unit 40 000
16
selling
What is the cost of completing one price per unit
house? 30
total fixed costs 35 000
A $125 000 B $126 000 C $127 000 D $151 000
budgeted profit 95 000  
 
  How many units should it produce to achieve the budgeted profit?
27 Which item needs to be increased to make a break-even point fall?

(Nov14/11/Q26)  
A budgeted sales
  B fixed costs
A 4286 B 4334 C 6786 D 9286
Q30.  
29 The marginal costs
C following information is available for a manufacturing company for June 2014.
D selling prices
budgeted overheads $108 000
actual overheads $112 000
budgeted labour hours 24 000
actual labour hours 23 000

What is the over or under absorption of overheads for June 2014?

© UCLES 2014 9706/11/O/N/14
A $4000 over absorbed
B $4000 under absorbed
C $8500 over absorbed
D $8500 under absorbed
 
 
30   A business provides the following information for July.
(Nov14/11/Q29)  
$

 
budgeted bank overdraft at 1 July 12 000
total receipts banked 250 000
total cheque payments 195 000
 A 0.31 times
B 0.44 times
C 1.84 times
D 2.26 times
Q31.  
25 The direct material cost of 20 000 units is $8000. 400 direct labour hours are required at a cost of
$6000. Overheads are absorbed at 150% of the cost of direct labour.

What is the cost per unit?

A $0.40 B $0.70 C $0.85 D $1.15

 
26 (June   14/13/Q25)  
The following information is available.
  9
Q32.   $
27 A business absorbs overheads at a rate of $10.50 per labour hour. The following information is
break even sales revenue 15 000
available.
unit sales price 9 10

27 A business absorbs overheads budgeted

fixed costs overheads
at a rate of $10.50 per$68 250
6 000hour. The following information is
labour
available. actual overheads $66 175
What is the variable cost per unit?
actual labour hours 5976
A $2.00 B $2.50budgeted overheads
C $4.00 $68 250D $6.00
What is the value of under or over absorbed
actual overheads?
overheads $66 175

A $2075 over actual labour hours 5976

What
© UCLES 2014
B
is $2075
theunder
value of under or over absorbed overheads?
9706/13/M/J/14

C $3427 over
A $2075 over
D
B
$3427 under
$2075 under  
 
28 (June   14/13/Q27)  
C $3427 over
A company uses a direct labour rate of $5.40 per hour to absorb production overhead. Each unit
  of $3427manufactured
D product under requires four direct labour hours.
Q33.  
The following information is available for a period.
28 A company uses a 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
actualisproduction
available for a period.
overhead 518 400
under absorbed production overhead 32$400

What was the actual actual

output production
of the product in the period?
overhead 518 400

A 22 500 units under absorbed production overhead 32 400

B 000the
What24was units
actual output of the product in the period?
C 25 500 units
A 22 500 units
D
B 24 000
90 000 units
units
C 25 500 units
29 A company sells a product for $12 per batch.
D 90 000 units
 
 
The variable cost is $4 per batch.

29 (June  
Fixed 14/13/Q28)  
A company
costs sells a productbased
are absorbed for $12
onper batch. activity level of 100 batches at $3 per batch.
a normal
  The variable cost is $4 per batch.
 
What is the profit under marginal costing if the company makes and sells 125 batches?

  A
Fixed costs are absorbed
$500 B $625based on a normal
C $700activity level of 100
D batches
$1000 at $3 per batch.
 
 
What is the profit under marginal costing if the company makes and sells 125 batches?

A $500 B $625 C $700 D $1000

© UCLES 2014 9706/13/M/J/14 [Turn over

 AB fixed
totalcost percost
fixed unit
B total fixed cost
C total variable cost
C total variable cost
D variable cost per unit
D variable cost per unit
Q34.  
25 The following information is available about a customer order.
25 The following information is available about a customer order.

$ $

direct
direct material
material costcost 75.00 75.00
direct labour
direct costcost
labour 42.00 42.00
cost perper
cost labour hourhour
labour 7.00 7.00
fixed overhead absorption rate per direct labour hour 6.50
fixed overhead absorption rate per direct labour hour 6.50
The order has a mark-up calculated at 20% of total cost.
The order has a mark-up calculated at 20% of total cost.
What is the selling price?
What is the selling price?
 
A $117.00 B $140.40 C $156.00 D $187.20
(June   14/11/Q25)  B
A $117.00 $140.40 C $156.00 D $187.20
26 Q35.  
What can be used to apportion production overheads to cost centres?
26 AWhat can
cost be used to apportion production overheads to cost centres?
of machinery
BA direct
cost labour hours
of machinery
CB indirect
direct material cost
labour hours
D sales department labour hours
C indirect material cost
D sales department labour hours
 
(June  14/11/Q26)  
Q36.   9

27 The following information relates to two production departments of a manufacturing business.

assembly polishing
© UCLES 2014 9706/11/M/J/14
prime cost ($000) 880 1100
indirect overheads ($000) 996 1363
© UCLES 2014 9706/11/M/J/14
machine hours (000) 100 150
labour hours (000) 75 220

What are the overhead absorption rates?

assembly polishing
$ $

A 9.96 6.20
B 13.28 9.09
C 18.76 11.20
D 25.01 16.42
 
 
28 (June   14/11/Q27)  
A manufacturer has a total production cost of $50 000 to make 20 000 units. This increases to
 
$60 000 if production is increased to 25 000 units.

  What is the total cost of 35 000 units?

A $70 000 B $80 000 C $84 000 D $87 500

 
29 A company provides the following information about its product.

selling price $100

 production overheads $6 per unit
selling
27 A business overheads
sells $5 per
its product unit per unit and has variable costs of $6 per unit. The table
for $10
shows the fixed costs for the year.
What is the total direct cost per unit?

A $36 B $42 C $90 $ D $101

Q37.   factory rent 30 000

10 000
27 A company receives an order forother units.
fixed costs 70 000
10
The
Whatfollowing informationpoint?
is themakes
break-even is available.
26 A business a single product. The following information is available.
A 10 000 units
Bunits16produced
667 unitsper machine
C 17 500 units
hour D 25 000 units
500
total cost
production
labour costs per machine hour $ $25
28 A company’s financial information is as follows.
raw material600
cost per unit
units 4200 $2
800 units per machine
overheads recovered 5200hour$ $40

What is the cost

What fixedof
cost selling price per unit
per unit?
production? 55
variable costs per unit 15
A $11 300
for 600 unitsB $21
for 300
800 units C $33 500 D $52 500  
  $ total$fixed costs 33 000

28 (Nov  
The 13/13/Q27)  
A costs of 2.00
a company that annually
1.50 sells 10 000 units are as follows.
  If the selling price is reduced to $40, how many extra units need to be sold to break-even?
  B 2.00 2.00
$
Q38.  
A C 495 5.00 B 825 5.00 C 1320
direct material 50 000
D 2200

  D 7.00 6.50
29 A company is asked to make aassembly new machinelabour 100 000 It provides the following estimates.
for a customer.
factory overheads 70 000
27 A company materials
produces willtwo
costdifferent
$1100 products which use the same material.
The normal selling
labour willisprice
be 30ofhours
each at unit is $50.
a cost ofand
$14the
percompany
hour
One month there a shortage of material needs to reduce production of one
Ifproduct.
it was reduced to $35, how many more units need
The company charges overheads at $10 per labour hour and has to be sold to break-even?
a mark up of 30% on total cost.
Of which
1500 product
units should the company reduce production first?D 5000 units
A
What is the price onBthe 2000 units
job cost sheet? C 3500 units
A the one with the higher contribution per kilo of material
A $1520 B $1820 C $1976 D $2366
B the one with the higher contribution per unit  
  C the one with the lower contribution per kilo of material
(Nov  13/12/Q29)  
  D the one with the lower contribution per unit
Q39.  
© UCLES 2013 9706/12/O/N/13

28 A factory has forecast total production overhead of $400 000 and forecast activity of 80 000
machine hours.

In April actual overheads are $385 000 and actual activity is 70 000 hours.
© UCLES 2013 9706/13/O/N/13
What is the level of under or over absorption in April?

A $35 000 over

B $35 000 under
C $40 000 over
D $40 000 under

 
(June  13/13/Q28)  
 
 
 
  2013
© UCLES 9706/13/M/J/13

 
 

 
 A X→Y→Z

B X→Z→Y

C Y→Z→X

D Z→Y→X
Q40.  
25 The following data is available for the production department of a manufacturing company.
Overheads are absorbed on a direct labour hour basis.

total
direct
overhead costs
labour hours
$

budgeted 96 000 242 880

actual 97 600 253 760

What is the over or under absorption of overheads for the period?

A $6832 over absorbed

B $6832 under absorbed
C $10 880 over absorbed

 
D $10 880 under absorbed
 
26 (June   13/12/Q25)  
The following information applies to a business.
  10

27   A business has fixed costs (units)

output sales profits
for a month of $150 000. 10
It sells
$ its single product for $20 per unit and
Q41.  
$
has a contribution/sales ratio of 0.75. It wishes to make a profit of $300 000 for the month.
29 What is the reason for overhead
375 absorption
750 000 in a100
manufacturing
000 business?
How many units does the business need to sell?
500 1 000 000 250 000
AA to
10 control
000 overhead
B 20 expenditure
000 C 22 500 D 30 000
Whatto
B is determine
the contribution
thetonet
sales ratio?
realisable value of inventory
28 AWhen25% valuing inventory
B 40% of finished goods
C on an absorption
50% D cost
60%basis, which costs should be
to enable overheads to be apportioned to cost centres
Cincluded?

 
DA to establish costs per unit of product
production
  B production
  and administration
(Nov  12/13/Q29)  
30 ACbusiness reports a profit
and using marginal costing of $75 000 for a month.
 
© UCLES production,
2013 marketing distribution
9706/12/M/J/13

Q42.  
D production, marketing, administration and distribution
Opening inventory was 10 000 units and closing inventory 15 000 units.
 
29 The fixed production
A hospital budgets for overhead absorption
overheads totalling rate000
$11 500 is $5
for per unit. year. It expects to treat
a financial
25 000 patients in the year. Each patient stays an average of 10 days and the hospital absorbs
overheads
What is theonprofit
a patient /dayabsorption
using basis. Its direct costs for the year are budgeted at $25 000 000.
costing?

AWhat$25
is its overhead absorption rate per patient day?
000 B $50 000 C $100 000 D $125 000
A $46 B $100 C $146 D $460
 
30 (Nov   12/11/Q29)  
The following data applies to a business.
 
  budgeted labour hours 10 000
  actual labour hours 9 500
 
  budgeted overheads $150 000

  actual overheads $160 000

 
  What is the amount of overhead under-absorbed?
A $7500 B $8000 C $10 000 D $17 500

 
 25 000 patients in the year. Each patient stays an average of 10 days and the hospital absorbs
overheads on a patient /day basis. Its direct costs for the year are budgeted at $25 000 000.

What is its overhead absorption rate per patient day?

A $46 B $100 C $146 D $460

Q43.  
30 The following data applies to a business.
10
budgeted labour hours 10 000
29 A business uses absorptionactual
costing.
labour hours 9 500
Which cost is used to valuebudgeted
finished inventory?
overheads $150 000

A full cost actual overheads $160 000

B prime
What is the cost
amount of overhead under-absorbed?
variable cost ofBproduction
AC $7500 $8000 C $10 000 D $17 500
variable cost of sales  
(Nov  12/11/Q30)  
D

Q44.  
30 The manufacture of which product is best suited to job costing?

A aeroplanes
B medicines
C newspapers
D paint
 
(June  12/13/Q30)   11
Q45.  
30 What is the purpose of a job cost sheet?

to
A 2012
© UCLES enable the business to recover9706/11/O/N/12
its overheads
B to ensure the customer knows the split between materials and labour
C to inform the customer of the profit margin
D to let the business find the price for a quotation

 
(June  12/12/Q30)  
  9
Q46.  
25 A company absorbs overheads on machine hours which are budgeted at 11 250. The budgeted
overhead is $281 250.

Results show actual hours of 10 980 and overhead of $276 652.

What is the under/over-absorption?

A overhead over-absorbed by $2152

B overhead over-absorbed by $4598
C overhead under-absorbed by $2152
D overhead under-absorbed by $4598
 
(Nov  11/13/Q25)  
26   A company uses absorption costing and makes and sells one product. In the last month budgeted
overheads totalled $60 000. Budgeted production was 15 000 units and budgeted sales were
14 000 units.

The company now decides to apply marginal costing principles for the last month.
 
Which effect will this have on profits?

A $3500 decrease
 royalty payment 1.00
administration overhead (fixed) 0.60

What is the contribution per DVD?

A $4.90 B $5.90 C $7.00 D $8.00

Q47.  
29 A business has the following budgeted and actual results for a period.

budgeted fixed overheads 354 000

actual fixed overheads 360 000
under absorption of overheads 3 000

The fixed overheads are absorbed per unit.

11
The budgeted number of units was 118 000.
28 What is a benefit of using absorption costing?
What is the actual level of activity in units?
A It allows a business to calculate the break-even point for production.
A 118 000 B 119 000 C 120 000 D 121 000  
 
B It allows a business to calculate the total cost of goods produced.

30 (Nov   11/13/Q29)  
It allows
CA business a businessatomachine
purchases show a lower valueItfor
for $3200. year end inventory.
is estimated that it will have a useful life of 5 years
 D It allows decision-making on utilising spare capacityisbycharged
and a residual value of $700. Straight line depreciation each
increasing year.
production.
Q48.  
What is the net book value at the end of year 2?
29 What will cause under-absorption of fixed production overheads?
A $1920 B $2200 C $2560 D $2700
absorption of overheads is based on actual expenditure and actual activity
A
11
B actual expenditure on overheads is below budget expenditure
28 What is a benefit of using absorption costing?
C actual activity is above budgeted activity
A It allows a business to calculate the break-even point for production.
D actual activity is below budgeted activity and actual expenditure is as budgeted
B It allows a business to calculate the total cost of goods produced.
 
(Nov  11/13/Q29)  
C It allows a business to show a lower value for year end inventory.
30
 ADbusiness provides
It allows the following
decision-making on data for the
utilising year.
spare capacity by increasing production.
Q49.  
budgeted output (units) 10 000
29 What will cause under-absorption of fixed production overheads?
actual output (units) 8 000
A absorption
© UCLES 2011 of overheads is based on actual expenditure
9706/13/O/N/11 and actual activity
$
B actual expenditure on overheads is below budget expenditure
budgeted fixed production costs 1 200 000
C actual activity is above budgeted activity
budgeted variable production costs 800 000
D actual activity isbudgeted
below budgeted activity and
fixed selling overhead actual expenditure is as budgeted
600 000
 
 What is the absorption cost per unit used for inventory valuation?
(Nov  11/13/Q28)  
  A business provides the following data for the year.
30 A $200 B $250 C $260 D $325

 
 
budgeted output (units) 10 000

  actual output (units) 8 000

  $
  budgeted fixed production costs 1 200 000
 
  budgeted variable production costs 800 000

  budgeted fixed selling overhead 600 000

 
  What is the absorption cost per unit used for inventory valuation?
A $200 B $250 C $260 D $325

 
26 A business sells its product for $50 a unit and has variable costs of $30 per unit. Its fixed costs for
this year were $200 000. Next year, fixed costs are expected to be $260 000.

How many more units will have to be sold next year to make the same profit as this year?

A 3000 B 5200 C 10 000 D 13 000

Q50.  
27 The following information is provided by a company for a month.

actual direct labour hours worked 4500

budgeted direct labour hours 5000
budgeted overhead expenditure $80 000
overheads under-recovered $12 000

What is the amount of the actual overhead expenditure?

A $60 000 B $68 000 C $72 000 D $84 000

 
(June  11/13/Q27)  
 
 
 
 
 
Q51.  
10

28 A business provides the following information for a month.

actual direct labour hours worked 8000

© UCLES 2011 actual overhead expenditure
9706/13/M/J/11 $88 000 [Turn over
budgeted direct labour hours 7500
budgeted overhead expenditure $90 000

What is the amount of the overhead over / under recovery?

A $2000 over-recovered
B $2000 under-recovered
C $8000 over-recovered
D $8000 under-recovered
 
(June  11/13/Q28)  
29   Which graph shows the fixed cost per unit produced in a manufacturing process?
 
A B
 
 
 
  fixed cost fixed cost
per unit per unit
 
 
 
  0
quantity produced
0
quantity produced
 
 
C D
 
 

fixed cost fixed cost

per unit per unit
 
 A increase operating profit
B no change in operating profit
C no change in operating profit but a 10 % increase in gross profit
D reduce operating profit

Q52.  
28 A job cost sheet showed the following estimates.

materials 680
labour at $20 per hour 200
overheads at $10 per labour hour 100
profit 280
price of job 1 260

The job actually took 25 % more labour hours than were estimated.

What was the profit?

9
A $205 B $230 C $330 D $355
24 Which cost will fall as production is reduced?

A fixed costs per unit  

(Nov   10/13/Q28)  
B total fixed costs
 
Q53.  
C total variable costs
 D variable costs per unit
8

23 A soup manufacturer uses batch costing. It produces a batch of 10 000 tins of soup with a direct
materials cost of $2500.
25 A particular cost is classified as ‘semi-variable’.
Direct labour involved 200 hours at a cost of $2000, and overheads are absorbed at the rate of
$15 per direct labour hour.
What effect will a 20 % reduction in activity have on the unit cost?
What is the cost of a tin of soup?
A decrease by 20 %
$0.25 $0.45 $0.55 $0.75
 
A B C D
B decrease by less than 20 %
 
24  C
The table shows
increase bycosts
20 % at three activity levels.
(June   10/13/Q23)  than 20 %
D increase by less
Q54.   activity levels 65 units 90 units 100 units

  $ $ $
A business
© UCLES
26 2010 uses job costing
fixed cost to calculate the cost
? of vehicle
? 9706/13/O/N/10 ? repair jobs. [Turn over

variableon
Overheads are allocated cost ?
an absorption ? basis. ?
costing
total cost 15 600 19 600 21 200
What is the effect of this method of allocation?
What is the fixed cost?
A overheads will include both fixed and variable overhead costs
A $1600 B $4000 C $5200 D $5600
B overheads will include direct costs only
A customer
25 C placeswill
overheads an include
order forfixed
20 000 bricks. costs only
overhead
Which
D costing method
overheads will the supplier
will include variableuse to price the
overhead order?
costs only
 
 A batch
27  A
B company
job has a product which sells for $1 per unit. The variable costs are $0.60 per unit, and
(Nov   09/12/Q26)  
production of
C marginal
200 000 units is planned.

Fixed
D unitcosts are $0.20 per unit at the budgeted production level.

 What is the break-even level?

26 A company has total production costs of $6000 to make 10 000 units, and $13 000 to make
24 000 units.
A 40 000 units B 66 667 units C 100 000 units D 160 000 units
  
 
  10 9
Q55.  
26 The
30 Thefollowing figures
graph shows are given forchart.
a break-even a factory’s overheads and machine hours worked.

sales revenue
overhead
50 machine hours total overhead costs
absorption rate
total costs
budgeted 40 122 000 $268 400 $2.20
actual 30 116 000 $261 000 $2.25
$000
20or over-absorption of overhead for the quarter?
What was the under-

A 10
$5800 over-absorbed
B 0
$5800 under-absorbed
0 1000 2000 3000 4000
C $7400 over-absorbed
units of sales
D $7400 under-absorbed
What are the fixed costs?  
(June  09/1/Q30)  
Q56.  
A $0 B $10 000 C $20 000 D $30 000
 
27 What is a benefit of using absorption costing?

A It allows a business to calculate the break-even point for production.

B It allows a business to calculate the total cost of goods produced.
C It allows a business to calculate the profit to be made on a product.
D It allows decision-making on utilising spare capacity by increasing production.
 
(Nov  08/1/Q27)  
28   A business provides the following data for the 10
year.
Q57.  
29 The following data applies to a output
budgeted business.
(units) 10 000
actual output (units) 8 000
budgeted labour hours 10 000
$
actual labour hours 9 500
budgeted fixed production costs 1 200 000
budgeted overheads $150 000
budgeted variable production costs 800 000
actual overheads $160 000
budgeted fixed selling overhead 600 000
What is the amount of overhead under-absorbed?
What is the absorption cost per unit used for stocktaking?
A $7500 B $8000 C $10 000 D $17 500
A $200 B $250 C $260 D $325  
 
30 (Nov   08/1/Q29)  
A company manufactures one product. Variable costs are $600 000. Fixed costs are $300 000.
 
  If it bought the product from another supplier, it could use existing machinery to make a total
  contribution of $400 000. Fixed costs would not change.
What is the maximum price it should pay to obtain the product from another supplier?
© UCLES
A 2009 9706/01/M/J/09
 
$600 000 B $700 000 C $900 000 D $1 000 000

© UCLES 2008 9706/01/O/N/08 [Turn over

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

A budgeted sales 11
B fixed costs
29 A company manufactures a product.
C marginal costs
  Information for the last two years is as follows:
Q58.  
D selling prices

  year 1 year 2
27 A company 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.
variable unit costs
The following information is available for a period.
6.00 7.00
fixed overheads per annum 24 000 25 200
actual production overhead $518 400
unit sales price 10.00 10.00
under-absorbed production overhead $32 400
In both years, production has been at break-even level.
What was the actual output of the product in the period?

AWhat is the
22 500 increase
units B 24in production
000 units in
C year 2 compared
25 500 units Dwith
30year 1?
000 units

increase in production

A 2400 units
B 3600 units
C 6000 units
10
D 8400 units  
28 (June  
A company08/1/Q27)  
makes two products. [Turn over
Q59.  
© UCLES 2008 9706/01/M/J/08

30 The table shows figures for a week’s production.product

X Y
expected production $10 000 units
$
expected production overhead
selling price 10 $50 000
12

actual productionvariable
overheadcosts per unit 4 8
$60 000
under-absorptionmaximum sales (units)
of overhead 4 000 14
$5000
000
Fixed costs are $48 000.
What is the actual amount of production in the week?
4000 units of X are sold.
A 9000 units B 9167 units C 11 000 units D 13 000 units
How many units of Y must be sold to break even?
 
(Nov  
A 2000 07/1/Q30)  B 3000 C 6000 D 12 000
Q60.  
29 A hospital budgets for overheads totalling $11 500 000 for a financial year. It expects to treat
25 000 patients in the year. Each patient stays an average of 10 days and the hospital absorbs
overheads on a patient/day basis. Its direct costs for the year are budgeted at $25 000 000.

What is its overhead absorption rate?

A $46 per patient day

B $100 per patient day
C $146 per patient day
D $460 per patient day

 
30  A video cassette has a selling price of $10.
(June  07/1/Q29)  
© UCLES 2007 9706/01/O/N/07
cost per video cassette $

direct materials 1.20

 
direct labour 0.80
factory overhead (fixed) 1.40
 What does XY represent?

A fixed costs
B gross profit
C net loss
  10
  D variable costs
10
Q61.  
28 The following figures are given for a factory’s overheads and machine hours worked.

The following
28 What
26 figures
will cause are given forofa fixed
under-absorption factory’s overheads
production and machine
overheads? hours worked.
overhead
machine hours total overhead costs
absorption rate
A absorption of overheads is based on actual expenditure and actualoverhead
activity
budgeted machine
122 000hours total overhead
$268 400 costs $2.20
B actual expenditure of overheads is below budget expenditure absorption rate
actual 116 000 $261 000 $2.25
C actualbudgeted 122 000 activity
activity is above budgeted $268 400 $2.20
Whatactual
D was actual
the under-
activity is or over-absorption
below of overhead
116 000 activity
budgeted for the
and$261
actual 000quarter? is as$2.25
expenditure budgeted
A $5800 under-absorbed
What was the under- or over-absorption of overhead for the quarter?  
27   The cost ofover-absorbed
B $5800 producing 2000 units of a product is shown.
(June   07/1/Q26)  
A $5800 under-absorbed
  B $5800 over-absorbed
C $7400 under-absorbed
$
  D $7400 over-absorbed
insurance 2 000
Q62.  
C $7400 under-absorbed
$7400 over-absorbed
D company
29 A labour
manufactures a single 30price
product with a selling 000 of $75 per unit. The table shows
the costs, based on sales and production
materialsvolume of 8000 units.
10 000
29 A company manufactures a single rent product with a selling price
6 000$ 000of $75 per unit. The table shows
the costs, based on sales and production volume of 8000 units.
prime coststelephone rental 4 000 158

variable manufacturing overheads $ 000

74
What is the variable cost of one unit?
prime
fixed costs
manufacturing overheads 80158
A $20 B $22 C $23 D $24
variableselling
variable manufacturing
overheadsoverheads 20 74

© UCLES 2007 fixed

fixedadministration
manufacturing overheads
overheads
9706/01/M/J/07 100 80 [Turn over
variablewhat
If absorption costing is applied, selling overheads
is the 20
gross profit on each unit sold?
fixed administration overheads 100
$21.00 $36.00 C $43.50 $46.00
 
A B D

  If absorption costing is applied, what is the gross profit on each unit sold?
30 (June   06/1/Q29)  
A company has two departments X and Y. Management provides the following information.
 
A $21.00 B $36.00 C $43.50 D $46.00

Q63.   department X department Y total

30 A company has two departments
power used 7 500 kwh X and Y. Management
17 500 kwhprovides the 25
following
000 kwhinformation.

area 30 000 square metres 20 000 square metres 50 000 square metres
department X department Y total
Thepower
powerused
bill for the year7 is500
$20kwh
000 and the rent is
17$100
500 000.
kwh 25 000 kwh
What is the total amount
area forsquare
30 000 rent and heating 20
metres to be attributed
000 square to department
metres X? square metres
50 000

The $54
A 000
power B $62 000
bill for the C $66 000
year is $20 000 and 000.$72 000
the rent is $100 D

What is the total amount for rent and heating to be attributed to department X?

A $54 000 B $62 000 C $66 000 D $72 000

 
(June  06/1/Q30)  
© UCLES 2006 9706/01/M/J/06

 
 
© UCLES 2006 9706/01/M/J/06