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BA2 Exam Dumps : Fundamentals of management accounting

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Fundamentals of management accounting Questions and Answers

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Question 1

Each unit of product GM requires 4 labour hours to be produced. 25% of the units will be completed during overtime hours.

Sales of 24,000 units are planned and finished goods inventory is budgeted to rise by 2,000 units.

If the wage rate is £6 per hour and the overtime premium is 50%, what is the budgeted labour cost?

Options:

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Question 2

A company operates an absorption costing system. Overheads are absorbed using a pre-determined absorption rate using labour hours.

Actual labour hours were 10% below budget for the period and overheads incurred were 10% above budget for the period. This would result in:

Options:

A.

An over-absorption of overheads for the period

B.

An under-absorption of overheads for the period

C.

Neither an over- or under-absorption of overheads for the period

D.

Impossible to tell from the information available

Question 3

A company hires a delivery vehicle for $200 per day plus $2 per kilometre travelled. The total hire cost would be described as:

Options:

A.

a fixed cost

B.

a variable cost

C.

a step cost

D.

a semi-variable cost

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