6. A company operates a retail supermarket chain selling a range of grocery and household products. It has branches throughout the country and is reviewing the range of goods to be stocked in each of these branches. How might the company best analyse its profitability for this purpose? A. By area of the country. B. By contract with each supplier. C. By customer payment method. D. By product line stocked. 7. Overhead allocation is the process of____________________. A. The charging of overhead to cost units. B. The allotment of proportions of items of cost to cost centres or cost units. C. The charging of direct material to jobs. D. The allotment of whole items of cost to cost centres or cost units.

8. Production supervisory salaries are classed as production overhead. Which is the most appropriate basis of apportioning this cost to cost centres? A. Number of units produced. B. Machine hours. C. Direct labour hours. D. Number of machines.

9. A variance report comparing actual results achieved during a month with the budgeted performance for the month is an example of__________________. A. Control action. B. Feedback control. C. Feedforward control. D. Reporting by exception. 10. Which of the following factors should be the least likely to affect a decision about whether to investigate a variance reported during a particular month in the middle of the financial year? A. Size of the variance. B. Whether it is favourable or adverse. C. Whether it is likely to be controllable. D. The trend in the monthly variance over the year to date.