Accounting 9706 · AS & A Level · Costs and cost behaviour

Costs and cost behaviour — practice question

The budgeted figures for one month are presented below. Units sold = $20\,000$ Selling price per unit = $\$12$ Variable cost per unit = $\$3$ Fixed costs = $\$50\,000$ The quantity of units sold is expected to rise by $10\%$. Fixed costs are expected to rise by $5\%$. What increase in profit will result from these changes?

  • A$\$15\,500$
  • B$\$18\,000$
  • C$\$20\,500$
  • D$\$21\,500$

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