A-LevelAccountingCostingFeb/Mar 2025Paper 1 Q271 Mark
A business prepared its statement of profit or loss for its first year of trading. It used marginal costing to value the inventory. The finance director wants to prepare the statement, using absorption costing. What will be the effect on inventory valuation and profit for the year due to this change?
Aeffect on inventory valuation: decrease, effect on profit for the year: decrease
Beffect on inventory valuation: decrease, effect on profit for the year: increase
Ceffect on inventory valuation: increase, effect on profit for the year: decrease
Deffect on inventory valuation: increase, effect on profit for the year: increase
✓ Correct Answer
The correct answer is D. This question tests the candidate's understanding of costing within the Accountingsyllabus. The examiner's mark scheme requires...
📋 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...
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