Question
1. Leon ltd prints two weekly magazines: Hello (40,000 copies in one weekly production run) and the Family (25,000 copies in total, 2 production runs
1. Leon ltd prints two weekly magazines: Hello (40,000 copies in one weekly production run) and the Family (25,000 copies in total, 2 production runs every week.) Total Production run set- up costs amount to 2,150 every week. Leon uses Activity- Based Costing and the number of production runs as a cost driver.
What is the set- up cost for each copy of the Family?
2. An airline wants to provide access to a select group of travel agents to real time information held by the airline regarding flights which may have the potential for passenger seat upgrades.
Which of the following is likely to be used to achieve this?
A. Intranet
B. Extranet
C. Internet
D. Email
3. Specsavers is a firm of opticians. It provides a range of services to the public, such as eye tests and contact lens consultations, and has a separate dispensary selling glasses and contact lenses. Patients book appointments with an optician in advance. A standard appointment is 30 minutes long, during which an optician will assess the patient's specific requirements and provide them with the eye care services they need. After the appointment, patients are offered the chance to buy contact lenses or glasses from the dispensary.
Which of the following describes a characteristic of the services provided by an optician at Specsavers during a standard appointment?
A. Tangible B. Homogeneous C. Non- perishable D. Simultaneous
4. UV Company has been asked to quote for a special contract. The following information about the material has been given: Material X: Book value 5 per kg Scrap value 0.50 per kg Replacement cost 5.50 per kg The contract requires 10 kgs of Material X. There are 250 kgs of this material in inventory which was purchased in error over 2 years ago. If Material X is modified, at a cost of 2 per kg, it could then be used as a substitute for material Y which is in regular use and currently cost 6 per kg.
What is the relevant cost of the materials for the special contract?
5. Brunto is considering a new project but is unsure how much overhead to include in the calculations to help him decide whether or not to proceed. Existing fixed overheads are absorbed at the rate of 8 per hour worked. Brunto is certain that the project will involve an incremental 500 labour hours. The project will involve extra machine running costs and these variable overheads cost him 4 per hour. The number of extra machine hours is expected to be 450 hours. The difference between this figure and the 500 labour hours above is expected idle time. The project will require a little more temporary space that can be rented at a fixed cost of 1,200 for the period of hire. The overhead is not included in the fixed overhead absorption rate above.
What is the overhead to be charged against the project decision?
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