A-LevelAccountingBudgeting and Decision MakingMay/June 2021Paper 1 Q281 Mark
The following information is available for a month. per unit $ selling price 100 contribution 30 Total fixed costs were $100000 and budgeted sales were 5000 units. The directors think that if they reduce the unit selling price to $95, sales will increase to 6500 units a month. What would be the increase in profit as a result of this?
A$12500
B$32500
C$45000
D$77500
✓ Correct Answer
The correct answer is A. This question tests the candidate's understanding of budgeting and decision making 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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