A-LevelAccountingTraditional costing methods9706/12 · Feb/Mar 2024 · Q251 Mark

What is an advantage of absorption costing?

AIt helps to determine a product’s selling price.

BIt is used to improve operational efficiency.

CIt makes it easy to analyse costs at different production levels.

DIt takes into account only variable costs.

✓ Correct answer

A: It helps to determine a product’s selling price.

Oracle Prep sorts past-paper questions by topic, so you can drill Traditional costing methods and see which topics are most likely to come up next.

Topic: Traditional costing methods, A-Level Accounting (syllabus 9706). Multiple choice, 1 mark.
Source: A-Level Accounting, Feb/Mar 2024 Paper 1 Variant 2, question 25.

Questions and mark schemes are from past examination papers and remain the copyright of the exam board. How Oracle Prep builds its content

A company provides the following information. Budgeted overheads $136000; budgeted labour hours 10568; actual overhe…

The following information is for a business. Budgeted fixed costs per month $2000; target profit per month $3000; bu…

The costs of a company that annually sells 10000 units are as follows. Direct material $50000; assembly labour $1000…

Why is depreciation provided on non-current assets?

The following information relates to the disposal of a non-current asset. $ profit on disposal 5200 cost of non-curre…

Omar wishes to become a trader. He decides to buy an existing business in a good location. He pays more for the busin…