Level 4 Tests

ABC Ltd has budgeted sales of 12,000 units and 12,400 units of their product for quarters 1 and 2 respectively. The inventory at the start of quarter 1 is 2,100 units. The closing inventory at the end of quarter 1 should be 20% of the following quarter’s forecast sales volume. The production volume for quarter 1 will be _______________ units.

A business has budgeted sales for the following period of 2,800 units of product X. The inventory at the start of the period is 450 units, and this is to be reduced to 390 units at the end of the period. What is the production quantity for the period?

If a business requires 4,560 fit for purpose units of its product to be produced in its first quarter, but 5% of all units produced fail quality checks and must be scrapped, it must produce _______________ units in total.

A company uses 1,250 hours of labour at a cost of £10,625. The budgeted production was 500 units, which requires 1,500 labour hours at a total standard cost of £12,000. The actual production was 410 units. The labour efficiency variance is:

Alpha Ltd wants to implement target costing whilst introducing a new product. All products must achieve at least 20% profit margin. The business has firm orders for the product at a selling price of £25 per unit. The fixed cost per unit is £6.50. Each unit uses 2.5 litres of material costing £4/litre. The product will take 20 minutes of labour time per unit to manufacture. What is the maximum price the business will be willing to pay per labour hour in order to meet its profit target?

According to IFRS 10 Consolidated Financial Statements, control requires exposure or rights to variable returns and the ability to affect those returns through power over an investee. Such rights can be straightforward (e.g. through voting rights), but can be more complex. Control is presumed when the parent acquires more than half of the voting rights of the entity.

However, even when more than one half of the voting rights is not acquired, control may be evidenced by which of the following? (There may be more than one that apply)

According to IAS 7, what are the three required classifications of cash flows?

The figure for tax paid in the year is the amount of taxation in the Statement of Profit or Loss for the current year. True or False?