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?
A$3500 decrease
B$3500 increase
C$4000 decrease
D$4000 increase
✓ Correct Answer
The correct answer is C. This question tests the candidate's understanding of costing methods 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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