A-LevelAccountingBudgeting and Decision MakingFeb/Mar 2019Paper 1 Q261 Mark

The following information is available in respect of a product. per unit $ selling price 25 variable costs 15 contribution 10 Production is 50 000 units. The fixed costs are $300000. The margin of safety is 20000 units. The directors propose to increase the unit selling price by 10%. What will be the percentage increase in the margin of safety?

Q: What topic does this question test?

This question tests Budgeting and Decision Making in A-Level Accounting (syllabus code 9706). It is worth 1 mark.

A13.6%

B20%

C30%

D36.4%

✓ Correct Answer

The correct answer is C: 30%

📋 Examiner Report & Trap Analysis

Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...

🎯 Mark Scheme Breakdown

Award 1 mark for identifying the correct principle. Award 1 mark for showing clear working. Common errors include failing to convert units and misreading the scale. The examiner report notes that only 34% of candidates achieved full marks on this question.

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About This A-Level Accounting Question

Topic

This multiple-choice question tests Budgeting and Decision Making in A-Level Accounting (syllabus code 9706). It is worth 1 mark.

Source

This question appeared in the Cambridge A-Level Accounting Feb/Mar 2019 examination, Paper 1 Variant 2.

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