A-LevelAccountingTraditional costing methods9706/12 · Feb/Mar 2018 · Q221 Mark

Which statements about absorption costing are correct? 1 It can be used as a basis for calculating the selling price of a product. 2 It ensures that all the costs of the business are charged to the production. 3 It ensures that only variable costs are charged to production. 4 It is used to calculate the factory cost for a unit of production.

A1 and 2

B1 and 4

C2 and 4

D3 and 4

✓ Correct answer

B: 1 and 4

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Topic: Traditional costing methods, A-Level Accounting (syllabus 9706). Multiple choice, 1 mark.
Source: A-Level Accounting, Feb/Mar 2018 Paper 1 Variant 2, question 22.

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