AQA A-Level Accounting 3.2 Management accounting overview quiz quiz

To calculate the profit for the year by matching all revenues against the costs incurred

To value the closing inventory using either marginal or absorption costing principles

To plan and manage the liquidity of the business by forecasting receipts and payments

To allocate fixed overheads fairly across the various products that the firm makes

$18

$32

$50

$82

Fixed costs for the period happen to be exactly zero across the whole business

Variable costs per unit are zero so every sale is pure contribution

The business makes a trading loss rather than a profit in the period

There is no change in inventory (production equals sales)

2,000 units

3,000 units

4,000 units

6,000 units

3,000 units

7,500 units

1,500 units

4,500 units

$200 adverse

$150 favourable

$150 adverse

$200 favourable

Net present value

Payback period

Accounting rate of return

The margin of safety

4 years

5 years

6 years

4.5 years

$1,000

-$4,000

-$1,000

$7,000

The total absorbed cost per unit, including a full share of the fixed overheads

The accounting rate of return calculated over the whole life of the project

The historic cost of the assets used to manufacture the order

Whether the order price exceeds the variable cost, adding contribution