UCLES 2016 970612FM16 Turn over 20 The following ratios have been calculated

Ucles 2016 970612fm16 turn over 20 the following

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7© UCLES 2016 9706/12/F/M/16 [Turn over20The following ratios have been calculated for two businesses, both with the same revenue of $100000. X gross margin 20% 25% profit margin 10% 10% How do the cost of sales and expenses of X compare with those of Y? Y cost of sales expenses A higher higher B higher lower C lower higher D lower lower 21 A business provides the following information. gross margin 20% $ sales 275325 opening inventory 25450 closing inventory 55975 What are the purchases? 963 22 A company provided the following information. material units cost per unit $ opening inventory 100 2.00 receipt of new inventory 400 2.10 issued to production 200 The company uses the first in first out (FIFO) method of valuing inventory. What is the cost of material issued to production? D $420
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823 A production centre uses 20000 machine hours and 17000 labour hours each month. Which formula is used to calculate the overhead absorption rate? © UCLES 2016 9706/12/F/M/16 24The following information is available. budget actual overheads $60000 $66000 direct labour 30000 hours 35000 hours The overhead absorption rate is based on direct labour hours. What is the amount of overhead over-absorbed or under-absorbed? A $4000 over B $4000 under C $6000 over D $6000 under 25A particular cost is classified as ‘semi-variable’. What effect will a 20% reduction in activity have on the unit cost?
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9 © UCLES 2016 9706/12/F/M/16 [Turn over26 A business produces and sells watches. In 2015, 4000 watches were produced and 3600 watches were sold. Other information for the year included the following: $ per unit direct materials 60 direct labour 80 variable selling expenses 15 fixed manufacturing overheads 45 fixed administrative costs 50 What is the cost of goods sold for 2015 if the business uses absorption costing? 000 27 Which items are included in the marginal cost of a unit of production?
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