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A-LevelAccountingTraditional costing methods9706/12 · Feb/Mar 2020 · Q261 Mark

A business plans to sell all the 10000 units produced next year at the same price as this year. Direct costs are forecast to decrease by $2 per unit and total fixed costs will increase by $40000. What will be the effect of this?

Adecrease decrease

Bdecrease increase

Cincrease decrease

Dincrease increase

✓ Correct answer

D: increase increase

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About this question

Topic: Traditional costing methods, A-Level Accounting (syllabus 9706). Multiple choice, 1 mark.
Source: A-Level Accounting, Feb/Mar 2020 Paper 1 Variant 2, question 26.

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