A level Edexcel business year 1 revision

Fixed costs are unaffected by output levels. Which is a fixed cost below ?

• raw materials

• production worker wages

• salaries of office staff

• packaging costs

Selling price = £12, variable cost per unit = £8, therefore :

• contribution per unit = £20

• contribution per unit = £1.50

• contribution per unit = £4

Fixed costs = £6000 per month, unit contribution £4, therefore :

• breakeven = 24000 units

• breakeven = 1500 units

• breakeven = 6004 units

• breakeven = 24000 units

Output = 2000 units and breakeven = 1500 units, therefore :

• margin of safety = 3500 units

• margin of safety = 500 units

• margin of safety = 3500 units

• margin of safety = 3 million units

Total revenue = £32000, Fixed costs = £6000, total variable costs = £14000, therefore :

• Profit = £ 12000

• Profit = £ 26000

• Profit = £ 18000

• Profit = £ 8000

• current ratio = 0.5

• current ratio = 2

• current ratio = 1.87

• current ratio = 0.53

Current assets include : inventory (stock), cash, bank and :

• trade payables

• trade receivables

• value of vehicles

• value of machinery

If inventory (stock) = 300, then :

• acid test ratio = 2

• acid test ratio = 0.5

• acid test ratio = 1.5

• acid test ratio = 1

Gross profit = £ (a)  

• Gross profit margin = 30%

• Gross profit margin = 62.5%

• Gross profit margin = 266%