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BA2 - Fundamentals of management accounting

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BA2 Questions and Answers

Question # 1

When sales and output have passed the break-even point, the contribution per unit, for each unit then sold, becomes:


The profit per unit






The margin of safety

Question # 2

A fixed budget is:


A budget for fixed overheads


A budget which shows costs and revenues at different levels of activity


A budget which shows costs and revenues for a single level of activity


A budget prepared on a continuous basis

Question # 3

PQR Manufacturing Ltd. has £3,000,000 of fixed costs for the forthcoming period. The company produces a single product 'X', which has a selling price of £75 per unit and total cost of £50.

75% of the total cost represents variable costs.

How many units (to the nearest whole unit) will the organization need to produce and sell to generate a profit of £500,000?

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