BA2 Exam Dumps : Fundamentals of management accounting

Refer to the exhibit.

A project is forecast to generate the following cash flows.

Using three decimal places in all discount factors, the net present value (NPV) for the project at a cost of capital of 14.5% is (to the nearest $)

Which THREE of the following statements could explain why a favourable sales volume contribution variance has arisen?

During the first financial period of this year a company posted profit of £340,000. However, their overheads were over absorbed by £20,000 in this period. As a result they tried to update their absorption rate for the current

period and as such they ended up under absorbing their overheads by £12,000.

They have also reported a sales volume increase of 550 when comparing this period to last.

You have been given the following information on unit cost/prices:

Selling price = £95 per unit

Variable production cost per unit = £15

Variable selling cost per unit = £18

Fixed overhead per unit = £8

They have asked you to reconcile their profit between periods.

Based on the information you have been given, what is their profit for the current period?