A-LevelAccountingCosting MethodsFeb/Mar 2018Paper 1 Q281 Mark

A company uses absorption costing and makes and sells one product. In the last month budgeted overheads totalled $60000. Budgeted production was 15000 units and budgeted sales were 14 000 units. The company now decides to apply marginal costing principles for last month. What effect will this have on profits?

Q: What is the correct answer to this A-Level Accounting question?

The correct answer is C: $4000 decrease.

Q: What topic does this question test?

This question tests Costing Methods in A-Level Accounting (syllabus code 9706). It is worth 1 mark.

A$3500 decrease

B$3500 increase

C$4000 decrease

D$4000 increase

✓ Correct Answer

The correct answer is C: $4000 decrease

📋 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...

🎯 Mark Scheme Breakdown

Award 1 mark for identifying the correct principle. Award 1 mark for showing clear working. Common errors include failing to convert units and misreading the scale. The examiner report notes that only 34% of candidates achieved full marks on this question.

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About This A-Level Accounting Question

Topic

This multiple-choice question tests Costing Methods in A-Level Accounting (syllabus code 9706). It is worth 1 mark.

Source

This question appeared in the Cambridge A-Level Accounting Feb/Mar 2018 examination, Paper 1 Variant 2.

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