
Business Revision Quiz 2 - Budgets, Business Costs
Authored by Callum Richardson
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12th Grade
Used 17+ times

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19 questions
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1.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
Which of these actions might help correct an adverse overheads variance
Increase bonus payments
Offer promotional discounts
Cut supplier payments for raw materials
Reduce Head Office staff numbers
2.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
Which one of these would result in a favourable budget variance
Actual gross profit 13k; Budget gross profit 16k
Actual sales 40k; Budget sales 42k
Budget cost 18k; Actual cost 16k
Budget revenue 125k; Actual revenue 115k
3.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
A potential downside of budgeting is that budget-holders
Might spend their budget rather than make savings
Will feel less motivated
Might take short-term decisions
Will always spend more than their allowance
4.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
Which one of the following is an adverse variance
Marketing expenditure lower than budget
Sales revenue lower than budget
Raw materials cost lower than budget
Gross profit margin higher than budget
5.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
Which one of these is most likely to result in an adverse overheads variance?
Actual gross profit margin is 5% less than budget
Capital spending falls short of budget
Customers respond to a price cut
Management get a surprise pay increase
6.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
A common reason why many small businesses don't use budgets is that:
Budgeting can be time-consuming
SMEs don't record variances
Trading is too predictable
The law only requires them for large firms
7.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
Which of these statements about budgeting is incorrect?
A budget is a financial plan
Budgets provide direction and coordination
Budgets can help motivate staff
A forecast looks forward whereas a budget looks back
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