Podcast
Questions and Answers
What is the correct annual depreciation charge for the new computers purchased by Grassroots Ltd given a cost of €75,000, a useful life of 5 years, and a residual value of €5,000?
What is the correct annual depreciation charge for the new computers purchased by Grassroots Ltd given a cost of €75,000, a useful life of 5 years, and a residual value of €5,000?
- €10,000
- €15,000
- €13,000
- €14,000 (correct)
After a year, how would you calculate the carrying amount of total non-current assets for a company that began with €500,000, had a depreciation of €60,000, and acquired new assets costing €40,000?
After a year, how would you calculate the carrying amount of total non-current assets for a company that began with €500,000, had a depreciation of €60,000, and acquired new assets costing €40,000?
- €440,000
- €480,000
- €460,000 (correct)
- €400,000
Where should the withdrawal of €20,000 by an entrepreneur for private purposes be classified in the statement of cash flows?
Where should the withdrawal of €20,000 by an entrepreneur for private purposes be classified in the statement of cash flows?
- The transaction is not recorded on the statement of cash flows.
- The transaction is recorded as cash flows from financing activities. (correct)
- The transaction is recorded as cash flows from investing activities.
- The transaction is recorded as cash flows from operating activities.
What does the balance of trade payables represent?
What does the balance of trade payables represent?
How does new asset acquisition of €40,000 during the year impact the total amount of non-current assets?
How does new asset acquisition of €40,000 during the year impact the total amount of non-current assets?
What remains constant in the straight-line depreciation method over the useful life of an asset?
What remains constant in the straight-line depreciation method over the useful life of an asset?
What is the effect of withdrawing funds from a business on its equity?
What is the effect of withdrawing funds from a business on its equity?
What method is typically used to determine the annual depreciation expense for furniture and fittings in a company?
What method is typically used to determine the annual depreciation expense for furniture and fittings in a company?
Which action could help Dusk Ltd achieve a 10% reduction in operating expenses?
Which action could help Dusk Ltd achieve a 10% reduction in operating expenses?
Where is the purchase of inventories on credit recorded in the statement of cash flows?
Where is the purchase of inventories on credit recorded in the statement of cash flows?
Which statement correctly describes the relationship between net profit and equity?
Which statement correctly describes the relationship between net profit and equity?
What is the total depreciation for the computer equipment after 7 months of ownership?
What is the total depreciation for the computer equipment after 7 months of ownership?
How does reducing the cost of sales affect a company's financials?
How does reducing the cost of sales affect a company's financials?
What is the impact of capitalizing a purchase of machinery on the balance sheet?
What is the impact of capitalizing a purchase of machinery on the balance sheet?
Which of the following correctly identifies an asset?
Which of the following correctly identifies an asset?
What is the total amount of non-current assets for Rust Ltd?
What is the total amount of non-current assets for Rust Ltd?
How should cost of sales be classified?
How should cost of sales be classified?
What direct effect does an increase of €20,000 in the purchase of inventories have on profit levels?
What direct effect does an increase of €20,000 in the purchase of inventories have on profit levels?
What will be the value of equity on 31 December 2023 for Reeds Ltd?
What will be the value of equity on 31 December 2023 for Reeds Ltd?
If interest costs decreased by €25,000, what is the effect on profit levels?
If interest costs decreased by €25,000, what is the effect on profit levels?
Which option best describes retained earnings?
Which option best describes retained earnings?
What is the implication of a company's purchase of non-current assets?
What is the implication of a company's purchase of non-current assets?
What is the cost of sales calculated if the beginning inventory is €50,000, purchases during the year are €300,000, and the ending inventory is €60,000?
What is the cost of sales calculated if the beginning inventory is €50,000, purchases during the year are €300,000, and the ending inventory is €60,000?
Which statement accurately describes a financial statement's function regarding inventories?
Which statement accurately describes a financial statement's function regarding inventories?
If a company has sales revenue of €200,000, purchases of €110,000, and a gross profit margin of 40%, what is the cost of sales?
If a company has sales revenue of €200,000, purchases of €110,000, and a gross profit margin of 40%, what is the cost of sales?
What is the correct definition of gross profit margin?
What is the correct definition of gross profit margin?
What could be a consequence of overstating inventory levels in financial statements?
What could be a consequence of overstating inventory levels in financial statements?
Which of the following is NOT typically included in the statement of cash flows?
Which of the following is NOT typically included in the statement of cash flows?
When calculating cost of sales, which of the following components is NOT considered?
When calculating cost of sales, which of the following components is NOT considered?
Which statement is true about the relationship between gross profit and expenses?
Which statement is true about the relationship between gross profit and expenses?
How much can Linda save by choosing Supplier 2?
How much can Linda save by choosing Supplier 2?
What is the total area of the room where tiles need to be placed?
What is the total area of the room where tiles need to be placed?
Including wastage, how much surface area in m² should be estimated for tiling?
Including wastage, how much surface area in m² should be estimated for tiling?
What is the cost per square meter for tiles?
What is the cost per square meter for tiles?
What is the estimated total budgetary cost for the tiling project?
What is the estimated total budgetary cost for the tiling project?
How much butter does Emily need for two batches of cookies?
How much butter does Emily need for two batches of cookies?
How much will Emily spend on sugar for the cookies if she uses the needed amount?
How much will Emily spend on sugar for the cookies if she uses the needed amount?
If Emily buys 2 boxes of eggs costing €4.50 each, what will be the total cost for the eggs?
If Emily buys 2 boxes of eggs costing €4.50 each, what will be the total cost for the eggs?
How many additional wagons are needed to increase the ride capacity by a minimum of 120 visits per hour?
How many additional wagons are needed to increase the ride capacity by a minimum of 120 visits per hour?
What is the capacity utilization rate for SSC Napoli during the 2022/2023 season?
What is the capacity utilization rate for SSC Napoli during the 2022/2023 season?
Which of the following statements about unintended and intended excess capacity is correct?
Which of the following statements about unintended and intended excess capacity is correct?
What is the total cost of equipment from Supplier 1 after including import duty and delivery costs?
What is the total cost of equipment from Supplier 1 after including import duty and delivery costs?
Which factor would lead Linda to decide against choosing Supplier 1?
Which factor would lead Linda to decide against choosing Supplier 1?
How is the import duty calculated for Supplier 2?
How is the import duty calculated for Supplier 2?
Which of the following best describes the cost advantage Linda would gain by selecting the lowest cost supplier?
Which of the following best describes the cost advantage Linda would gain by selecting the lowest cost supplier?
Based on the information provided, how many visits does the stadium need to achieve a 100% capacity utilization rate?
Based on the information provided, how many visits does the stadium need to achieve a 100% capacity utilization rate?
Which of these represents an asset?
Which of these represents an asset?
What is the direct effect on profit levels from an increase in the purchase of inventories by €20,000?
What is the direct effect on profit levels from an increase in the purchase of inventories by €20,000?
What will be the value of equity for Reeds Ltd on 31 December 2023?
What will be the value of equity for Reeds Ltd on 31 December 2023?
What is the effect on profit levels if interest costs decrease by €25,000?
What is the effect on profit levels if interest costs decrease by €25,000?
What is the classification of software licenses for Rust Ltd?
What is the classification of software licenses for Rust Ltd?
What does a bank loan to finance new IT hardware represent in accounting terms?
What does a bank loan to finance new IT hardware represent in accounting terms?
How should a financing transaction be recorded on the statement of cash flows?
How should a financing transaction be recorded on the statement of cash flows?
What is the expected number of visits if the break-even point is 3,000 visits with a margin of safety of 40%?
What is the expected number of visits if the break-even point is 3,000 visits with a margin of safety of 40%?
What cost type is directly connected to the level of business activity?
What cost type is directly connected to the level of business activity?
If a company expects 2,000 visitors with a break-even point of 1,400 visitors, what is the margin of safety?
If a company expects 2,000 visitors with a break-even point of 1,400 visitors, what is the margin of safety?
Which type of cost structure is considered less risky for a company?
Which type of cost structure is considered less risky for a company?
How many t-shirts must be sold each day to break even, given a sale price of €25 and a cost of sales of €8 with fixed costs of €2,550?
How many t-shirts must be sold each day to break even, given a sale price of €25 and a cost of sales of €8 with fixed costs of €2,550?
What additional revenue is required for a company with sales of €300,000, variable costs of €60,000 and fixed costs of €210,000 to increase profit by €2,400?
What additional revenue is required for a company with sales of €300,000, variable costs of €60,000 and fixed costs of €210,000 to increase profit by €2,400?
An event is expected to have 2,000 visitors with a break-even point at 1,400. If the cost per visitor is €10, what is the total contribution margin if all visitors attend?
An event is expected to have 2,000 visitors with a break-even point at 1,400. If the cost per visitor is €10, what is the total contribution margin if all visitors attend?
What is the total budget for an advertisement that is clicked 2,000 times, following the specified rates?
What is the total budget for an advertisement that is clicked 2,000 times, following the specified rates?
What is the regular ticket cost after including the supplement for both Anne-Sophie and Marie?
What is the regular ticket cost after including the supplement for both Anne-Sophie and Marie?
What gross salary does Sam need to earn as a festival administrator to match his current marketeer salary on an hourly basis?
What gross salary does Sam need to earn as a festival administrator to match his current marketeer salary on an hourly basis?
What is the tax Kim effectively pays on her €15,000 gift after considering the tax-free amount?
What is the tax Kim effectively pays on her €15,000 gift after considering the tax-free amount?
How much would Marie's discounted ticket cost excluding the supplement?
How much would Marie's discounted ticket cost excluding the supplement?
If the festival administrator job offers a lower gross salary than the marketeer role, what is the key factor that contributes to Sam's decision?
If the festival administrator job offers a lower gross salary than the marketeer role, what is the key factor that contributes to Sam's decision?
What is the children's discount rate on Marie's ticket if Anne-Sophie's ticket is €21?
What is the children's discount rate on Marie's ticket if Anne-Sophie's ticket is €21?
What is the minimum number of hours Sam needs to work in his new job to earn at least the same amount as in his current job?
What is the minimum number of hours Sam needs to work in his new job to earn at least the same amount as in his current job?
What was the cost of sales in the year if the inventories at the start were €50,000, purchases were €300,000, and inventories at the end were €60,000?
What was the cost of sales in the year if the inventories at the start were €50,000, purchases were €300,000, and inventories at the end were €60,000?
Which statement correctly identifies the function of the statement of financial position?
Which statement correctly identifies the function of the statement of financial position?
If a company has a sales revenue of €200,000 and purchases of €110,000, with a gross profit margin of 40%, what is the cost of sales?
If a company has a sales revenue of €200,000 and purchases of €110,000, with a gross profit margin of 40%, what is the cost of sales?
What can be inferred about the purchases recorded in the statement of cash flows?
What can be inferred about the purchases recorded in the statement of cash flows?
Which of the following statements regarding the statement of cash flows is false?
Which of the following statements regarding the statement of cash flows is false?
What is a common misconception about inventories as presented in financial statements?
What is a common misconception about inventories as presented in financial statements?
Which effect does an increase in inventories have on cash flows during a reporting period?
Which effect does an increase in inventories have on cash flows during a reporting period?
What is the implication of a gross profit margin of 40% on sales of €200,000?
What is the implication of a gross profit margin of 40% on sales of €200,000?
What is the annual depreciation charge for the computer equipment acquired on 1 June 2023, given a cost of €160,000, a useful life of 4 years, and a residual value of €16,000?
What is the annual depreciation charge for the computer equipment acquired on 1 June 2023, given a cost of €160,000, a useful life of 4 years, and a residual value of €16,000?
What amount is recorded as sales revenue in the income statement for Hop Ltd, which made credit sales of €50,000 and cash sales of €10,000?
What amount is recorded as sales revenue in the income statement for Hop Ltd, which made credit sales of €50,000 and cash sales of €10,000?
Where on the statement of cash flows is the purchase of inventories on credit recorded?
Where on the statement of cash flows is the purchase of inventories on credit recorded?
What was the value of trade receivables as at 31 December 2023?
What was the value of trade receivables as at 31 December 2023?
Which statement is correct regarding the net profit in a certain time period?
Which statement is correct regarding the net profit in a certain time period?
Which of the following correctly identifies a component of total revenue for a company?
Which of the following correctly identifies a component of total revenue for a company?
What was Moon Ltd's gross profit for the year ended 31 December 2023?
What was Moon Ltd's gross profit for the year ended 31 December 2023?
What will be the effect on profit levels if the cost of sales increases?
What will be the effect on profit levels if the cost of sales increases?
What is the direct effect on current assets when a company purchases inventories for €5,000 and pays via bank transaction?
What is the direct effect on current assets when a company purchases inventories for €5,000 and pays via bank transaction?
What financial strategy could a company use to improve net profit if sales remain constant?
What financial strategy could a company use to improve net profit if sales remain constant?
What was the cost of new inventories purchased by Stream Ltd in 2023?
What was the cost of new inventories purchased by Stream Ltd in 2023?
Where are rent expenses recorded in the income statement?
Where are rent expenses recorded in the income statement?
What amount is repaid in the first year for a loan of €5,000,000 with repayments in a straight line over 10 years?
What amount is repaid in the first year for a loan of €5,000,000 with repayments in a straight line over 10 years?
If a company had sales revenue of €200,000 and purchases of €110,000, what is the cost of sales if the gross profit margin is 40%?
If a company had sales revenue of €200,000 and purchases of €110,000, what is the cost of sales if the gross profit margin is 40%?
What is the total amount of non-current assets for Rust Ltd based on the provided information?
What is the total amount of non-current assets for Rust Ltd based on the provided information?
How should a transaction that involves acquiring long-term investments be recorded on the statement of cash flows?
How should a transaction that involves acquiring long-term investments be recorded on the statement of cash flows?
If the break-even point is 3,000 visits and the margin of safety is 40%, what is the expected number of visits?
If the break-even point is 3,000 visits and the margin of safety is 40%, what is the expected number of visits?
What type of cost varies directly with the level of production or business activity?
What type of cost varies directly with the level of production or business activity?
A company expects 2,000 visitors at its event with a break-even point of 1,400 visitors. What is the margin of safety?
A company expects 2,000 visitors at its event with a break-even point of 1,400 visitors. What is the margin of safety?
Which cost structure is generally considered less risky for companies?
Which cost structure is generally considered less risky for companies?
If a t-shirt costs €8 to produce and is sold for €25, with daily fixed costs of €2,550, how many t-shirts must be sold to break even?
If a t-shirt costs €8 to produce and is sold for €25, with daily fixed costs of €2,550, how many t-shirts must be sold to break even?
A company has sales revenue of €300,000, variable costs of €60,000, and fixed costs of €210,000. What additional revenue is needed to increase profit by €2,400?
A company has sales revenue of €300,000, variable costs of €60,000, and fixed costs of €210,000. What additional revenue is needed to increase profit by €2,400?
What does a higher variable cost proportion indicate about a company's cost structure?
What does a higher variable cost proportion indicate about a company's cost structure?
What would be the total depreciation for the computer equipment after two years of ownership given a cost of €75,000 and a residual value of €5,000?
What would be the total depreciation for the computer equipment after two years of ownership given a cost of €75,000 and a residual value of €5,000?
How would the acquisition of new non-current assets for €40,000 affect the total carrying amount of non-current assets at year-end?
How would the acquisition of new non-current assets for €40,000 affect the total carrying amount of non-current assets at year-end?
In the statement of cash flows, how is a private withdrawal of €20,000 by an entrepreneur categorized?
In the statement of cash flows, how is a private withdrawal of €20,000 by an entrepreneur categorized?
Which statement accurately describes trade payables?
Which statement accurately describes trade payables?
What is the net carrying amount of total non-current assets at the end of the year, given an initial value of €500,000 and the effects of depreciation and acquisitions?
What is the net carrying amount of total non-current assets at the end of the year, given an initial value of €500,000 and the effects of depreciation and acquisitions?
How is the annual depreciation amount calculated for the computers in this scenario?
How is the annual depreciation amount calculated for the computers in this scenario?
Calculate the total budget for an advertisement that is clicked 2,000 times based on the given rate structure.
Calculate the total budget for an advertisement that is clicked 2,000 times based on the given rate structure.
What does the residual value of computer equipment represent?
What does the residual value of computer equipment represent?
What is the amount paid by Anne-Sophie and Marie for their train tickets excluding the supplement?
What is the amount paid by Anne-Sophie and Marie for their train tickets excluding the supplement?
What would be the total non-current assets reported in the statement of financial position after accounting for depreciation and new acquisitions?
What would be the total non-current assets reported in the statement of financial position after accounting for depreciation and new acquisitions?
How many hours per week must Sam work as a festival administrator to match his gross salary as a marketeer?
How many hours per week must Sam work as a festival administrator to match his gross salary as a marketeer?
Calculate the effective tax rate Kim pays on her gift of €15,000 after accounting for the tax-free portion.
Calculate the effective tax rate Kim pays on her gift of €15,000 after accounting for the tax-free portion.
Which of the following statements best describes how the rates for the advertisement's clicks work?
Which of the following statements best describes how the rates for the advertisement's clicks work?
What is the overall cost Marie incurs for her train ticket after applying her discount?
What is the overall cost Marie incurs for her train ticket after applying her discount?
If Sam works 36 hours a week as a marketeer, what is his hourly wage based on his salary?
If Sam works 36 hours a week as a marketeer, what is his hourly wage based on his salary?
If the tax on Kim's gift is applied after the tax-free amount, how much of the gift is taxable?
If the tax on Kim's gift is applied after the tax-free amount, how much of the gift is taxable?
Which of the following is classified as an asset?
Which of the following is classified as an asset?
What is the calculated total amount of non-current assets for Rust Ltd?
What is the calculated total amount of non-current assets for Rust Ltd?
How is cost of sales best categorized?
How is cost of sales best categorized?
If inventories purchased increase by €20,000, which profit levels are affected?
If inventories purchased increase by €20,000, which profit levels are affected?
What will Reeds Ltd's total equity be on 31 December 2023?
What will Reeds Ltd's total equity be on 31 December 2023?
What is the impact on profit levels after a decrease of €25,000 in interest costs?
What is the impact on profit levels after a decrease of €25,000 in interest costs?
Which statement correctly describes retained earnings?
Which statement correctly describes retained earnings?
What component is NOT typically included in calculating cost of sales?
What component is NOT typically included in calculating cost of sales?
What is the correct calculation for the cost of sales if the beginning inventory is €50,000, purchases are €300,000, and the ending inventory is €60,000?
What is the correct calculation for the cost of sales if the beginning inventory is €50,000, purchases are €300,000, and the ending inventory is €60,000?
Which of the following statements about financial statements is correct?
Which of the following statements about financial statements is correct?
What is the cost of sales if a company has sales revenue of €200,000, purchases of €110,000, and a gross profit margin of 40%?
What is the cost of sales if a company has sales revenue of €200,000, purchases of €110,000, and a gross profit margin of 40%?
Which accounting concept primarily deals with the calculation of profit through sales and expenses?
Which accounting concept primarily deals with the calculation of profit through sales and expenses?
What would be the implication of an overstated inventory level in a company's financial statements?
What would be the implication of an overstated inventory level in a company's financial statements?
In the context of a company's financial position, how is gross profit defined?
In the context of a company's financial position, how is gross profit defined?
What financial statement would provide information on the company's cash transactions regarding inventory purchases?
What financial statement would provide information on the company's cash transactions regarding inventory purchases?
If a company realizes higher sales revenue but retains the same cost of sales, what would be the financial effect?
If a company realizes higher sales revenue but retains the same cost of sales, what would be the financial effect?
In which section of the statement of cash flows would a financing transaction be recorded?
In which section of the statement of cash flows would a financing transaction be recorded?
What type of cost fluctuates directly with business activity levels?
What type of cost fluctuates directly with business activity levels?
If a company expects 2,000 visitors and the break-even point is 1,400 visitors, what is the margin of safety?
If a company expects 2,000 visitors and the break-even point is 1,400 visitors, what is the margin of safety?
To break even when selling t-shirts for €25 each with a cost of sales of €8 and fixed costs of €2,550, how many t-shirts need to be sold per day?
To break even when selling t-shirts for €25 each with a cost of sales of €8 and fixed costs of €2,550, how many t-shirts need to be sold per day?
If a company has sales revenue of €300,000, variable costs of €60,000, and fixed costs of €210,000, how much additional revenue is needed to increase profit by €2,400?
If a company has sales revenue of €300,000, variable costs of €60,000, and fixed costs of €210,000, how much additional revenue is needed to increase profit by €2,400?
Which of the following is true about the relationship between profit and fixed costs?
Which of the following is true about the relationship between profit and fixed costs?
What is the capacity utilisation rate of a restaurant with 40 seats, utilised 12 times a day, opened 350 days a year, and having 65,000 visits last year?
What is the capacity utilisation rate of a restaurant with 40 seats, utilised 12 times a day, opened 350 days a year, and having 65,000 visits last year?
If a cinema has three halls, each with 100 seats and operates 12 hours daily except Monday and Tuesday, what is its maximum capacity per week?
If a cinema has three halls, each with 100 seats and operates 12 hours daily except Monday and Tuesday, what is its maximum capacity per week?
For the rollercoaster Taron with 4 seats in each of its 4 wagons, what is the duration of one ride, excluding boarding, if it serves 1,280 visitors per hour and the boarding time is 1 minute and 10 seconds?
For the rollercoaster Taron with 4 seats in each of its 4 wagons, what is the duration of one ride, excluding boarding, if it serves 1,280 visitors per hour and the boarding time is 1 minute and 10 seconds?
Which statement regarding unscheduled maintenance and excess capacity is correct?
Which statement regarding unscheduled maintenance and excess capacity is correct?
What is the total sales revenue recorded in the income statement if Hop Ltd made €50,000 in credit sales and €10,000 in cash sales during 2023?
What is the total sales revenue recorded in the income statement if Hop Ltd made €50,000 in credit sales and €10,000 in cash sales during 2023?
Which action could help Dusk Ltd achieve a reduction of 10% in their operating expenses?
Which action could help Dusk Ltd achieve a reduction of 10% in their operating expenses?
Considering the average duration of a movie in a cinema is 2 hours, what is the total weekly operation time for the cinema if it operates 10 hours a day?
Considering the average duration of a movie in a cinema is 2 hours, what is the total weekly operation time for the cinema if it operates 10 hours a day?
How is the purchase of inventories on credit reflected in the statement of cash flows?
How is the purchase of inventories on credit reflected in the statement of cash flows?
What will happen to the standard cost price if costs change during the year?
What will happen to the standard cost price if costs change during the year?
Which statement about net profit is correct?
Which statement about net profit is correct?
How many total visits must a rollercoaster with a maximum capacity of 1,280 visitors per hour achieve in one day to reach a total of 12,000 visits?
How many total visits must a rollercoaster with a maximum capacity of 1,280 visitors per hour achieve in one day to reach a total of 12,000 visits?
What total amount would be recorded in sales revenue if a company reports cash sales of €25,000 and credit sales of €35,000?
What total amount would be recorded in sales revenue if a company reports cash sales of €25,000 and credit sales of €35,000?
If a theme park's restaurant had 65,000 visits last year, what is the average number of visits per day?
If a theme park's restaurant had 65,000 visits last year, what is the average number of visits per day?
In the context of financial reporting, which of the following is true regarding the relationship between net profit and cash flow?
In the context of financial reporting, which of the following is true regarding the relationship between net profit and cash flow?
What is the impact of a transaction where a company purchases inventories on credit on its liabilities and cash flow?
What is the impact of a transaction where a company purchases inventories on credit on its liabilities and cash flow?
Which supplier offers the lowest total cost after including electricity, gas, and fixed costs for the entire year?
Which supplier offers the lowest total cost after including electricity, gas, and fixed costs for the entire year?
What is the total parking cost for Fred at the Station carpark from 17:00 to 21:00?
What is the total parking cost for Fred at the Station carpark from 17:00 to 21:00?
What is the minimum number of beer barrels Fred needs to purchase considering spillage?
What is the minimum number of beer barrels Fred needs to purchase considering spillage?
At what rate does the Q-Park carpark charge after 18:00?
At what rate does the Q-Park carpark charge after 18:00?
If a glass of beer is 15 cl, how many glasses can be filled from one barrel that holds 36 litres, if 20% is spilled before sale?
If a glass of beer is 15 cl, how many glasses can be filled from one barrel that holds 36 litres, if 20% is spilled before sale?
What is the fixed yearly cost difference between Supplier A and Supplier B?
What is the fixed yearly cost difference between Supplier A and Supplier B?
How does the hourly rate of the Cathedral carpark compare to that of the Q-Park carpark during night hours?
How does the hourly rate of the Cathedral carpark compare to that of the Q-Park carpark during night hours?
If Fred uses the Town Hall carpark, what is the cost for parking from 17:00 to 21:00?
If Fred uses the Town Hall carpark, what is the cost for parking from 17:00 to 21:00?
Flashcards
Depreciation expense for equipment
Depreciation expense for equipment
The portion of an asset's cost that is expensed over its useful life. It's calculated as (cost - salvage value) / useful life.
Sales revenue calculation
Sales revenue calculation
Total revenue generated from sales, including both cash and credit sales.
Financial objective: reduce operating expenses
Financial objective: reduce operating expenses
A goal to decrease costs associated with running a business, like rent or supplies.
Inventory purchase on credit
Inventory purchase on credit
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Statement of cash flow: operating activities
Statement of cash flow: operating activities
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Net profit and Equity relationship
Net profit and Equity relationship
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Net profit and Cash at bank relationship
Net profit and Cash at bank relationship
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Reducing operating expenses (e.g., rent, investments, cost of sales)
Reducing operating expenses (e.g., rent, investments, cost of sales)
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Annual Depreciation Charge
Annual Depreciation Charge
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Carrying Amount of Non-Current Assets
Carrying Amount of Non-Current Assets
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Withdrawal of Funds for Personal Use
Withdrawal of Funds for Personal Use
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Trade Payables
Trade Payables
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Statement of Cash Flows
Statement of Cash Flows
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Depreciation
Depreciation
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Non-current Assets
Non-current Assets
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Cash Flows from Financing Activities
Cash Flows from Financing Activities
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Asset
Asset
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Trade receivables
Trade receivables
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Cost of sales
Cost of sales
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Equity
Equity
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Net profit
Net profit
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EBIT (Earnings Before Interest and Taxes)
EBIT (Earnings Before Interest and Taxes)
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EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)
EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)
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EBITDA
EBITDA
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How does an increase in inventory purchases impact profits?
How does an increase in inventory purchases impact profits?
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Gross Profit Margin
Gross Profit Margin
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Statement of Financial Position
Statement of Financial Position
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Inventories
Inventories
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Purchases
Purchases
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Operating Expenses
Operating Expenses
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Sales Revenue
Sales Revenue
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Statement of Cash Flows: Financing Activities
Statement of Cash Flows: Financing Activities
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Break-Even Point
Break-Even Point
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Margin of Safety
Margin of Safety
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Variable Costs
Variable Costs
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Fixed Costs
Fixed Costs
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Cost Structure Risk
Cost Structure Risk
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Break-Even Analysis
Break-Even Analysis
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Calculate Break-Even Point (T-shirts)
Calculate Break-Even Point (T-shirts)
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Capacity Utilization Rate
Capacity Utilization Rate
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What is intended excess capacity?
What is intended excess capacity?
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Unintended excess capacity
Unintended excess capacity
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How to increase ride capacity
How to increase ride capacity
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Import duty
Import duty
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Exchange rate
Exchange rate
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Cost of equipment from Supplier 1
Cost of equipment from Supplier 1
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Cost of equipment from Supplier 2
Cost of equipment from Supplier 2
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Tile Cost Calculation
Tile Cost Calculation
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Waste Allowance
Waste Allowance
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What is the estimated cost of tiling?
What is the estimated cost of tiling?
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Cookie Recipe Scaling Up
Cookie Recipe Scaling Up
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Cost of Ingredients
Cost of Ingredients
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Buying Ingredients in Bulk
Buying Ingredients in Bulk
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Calculating Ingredient Costs
Calculating Ingredient Costs
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Total Cookie Baking Cost
Total Cookie Baking Cost
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Click Cost for Ads
Click Cost for Ads
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Calculating Total Ad Budget
Calculating Total Ad Budget
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Train Ticket with Discount
Train Ticket with Discount
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Discount Percentage Calculation
Discount Percentage Calculation
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Comparing Hourly Wages for Different Jobs
Comparing Hourly Wages for Different Jobs
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Effective Tax Rate on a Gift
Effective Tax Rate on a Gift
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Tax-Free Portion of a Gift
Tax-Free Portion of a Gift
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Finding the Total Tax Payable on a Gift
Finding the Total Tax Payable on a Gift
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Straight-line depreciation
Straight-line depreciation
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Carrying amount
Carrying amount
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Balance of trade payables
Balance of trade payables
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Withdrawal of funds for private purposes
Withdrawal of funds for private purposes
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Net Profit and Equity
Net Profit and Equity
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Net Profit and Cash at Bank
Net Profit and Cash at Bank
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Depreciation Charge Calculation
Depreciation Charge Calculation
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Additional Revenue for Profit Increase
Additional Revenue for Profit Increase
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Trade Receivables Calculation
Trade Receivables Calculation
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Gross Profit Calculation
Gross Profit Calculation
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Inventory Purchase Impact on Current Assets
Inventory Purchase Impact on Current Assets
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Cost of New Inventory Calculation
Cost of New Inventory Calculation
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Rent Expense Location on Income Statement
Rent Expense Location on Income Statement
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Loan Repayment in First Year
Loan Repayment in First Year
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What is the value of trade receivables at the end of the year?
What is the value of trade receivables at the end of the year?
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What is Moon Ltd's gross profit?
What is Moon Ltd's gross profit?
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Tiered Click Cost
Tiered Click Cost
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Total Ad Budget
Total Ad Budget
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Train Ticket Discount
Train Ticket Discount
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Discount Percentage
Discount Percentage
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Equivalent Hourly Wage
Equivalent Hourly Wage
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Effective Tax Rate
Effective Tax Rate
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Total Tax Payable
Total Tax Payable
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Cost of Sales Calculation
Cost of Sales Calculation
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Inventory Turnover
Inventory Turnover
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Depreciation Expense
Depreciation Expense
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Depreciation Charge
Depreciation Charge
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What is a trade receivable?
What is a trade receivable?
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What is equity?
What is equity?
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What is a non-current asset?
What is a non-current asset?
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What is cost of sales?
What is cost of sales?
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What is EBIT?
What is EBIT?
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What does it mean for equity to increase?
What does it mean for equity to increase?
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How does increasing inventory purchases affect profits?
How does increasing inventory purchases affect profits?
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What is depreciation?
What is depreciation?
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Calculate break-even point (units)
Calculate break-even point (units)
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What is a cost that is directly connected to the level of business activity known as?
What is a cost that is directly connected to the level of business activity known as?
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What kind of cost structure is less risky?
What kind of cost structure is less risky?
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Standard Cost Price
Standard Cost Price
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Unscheduled Maintenance
Unscheduled Maintenance
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Excess Capacity
Excess Capacity
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Ride Duration
Ride Duration
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Max Capacity
Max Capacity
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Pay-Per-Click Model
Pay-Per-Click Model
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Expected Energy Consumption
Expected Energy Consumption
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Cheapest Energy Supplier
Cheapest Energy Supplier
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Parking Cost Comparison
Parking Cost Comparison
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Beer Barrel Calculation
Beer Barrel Calculation
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Online Advertising Cost
Online Advertising Cost
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Gift Tax Calculation
Gift Tax Calculation
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Study Notes
Exam Instructions - Financial Management
- Exam: Financial Management
- Year: 1
- Month: February
- Year: 2024
- Exam Duration: 150 minutes
- Exam Time: 9 February 2024 13:30 - 17:25
- Number of Questions: 60
- Pass Mark: 63%
- Required Score: 37.98 points
- Allowed Materials:
- Textbook
- Handwritten notes
- Calculator (via Testvision)
- Scrap paper (via Testvision)
- ProctorExam Instructions (if applicable):
- No headphones/earplugs
- No talking/mumbling
- Remain visible to camera
Questions (Part A - Accounting)
- Question 1 (Multiple Choice): Calculate the cost of sales given beginning inventory (€50,000), purchases (€300,000), and ending inventory (€60,000).
- Question 2 (Multiple Choice): Determine which statement(s) are correct: Statement 1: The statement of financial position shows the inventories sold in a period of time. Statement 2: The statement of cash flows shows the total amount of inventories purchased in a period of time.
- Question 3 (Multiple Choice): Calculate the cost of sales: Sales revenue (€200,000), purchases (€110,000), gross profit margin (40%).
- Question 4 (Multiple Choice): Identify the asset among the options: Depreciation costs of a motor vehicle, Retained earnings, Trade receivables, Bank loan to finance new IT hardware.
Questions (Part A - Accounting) Continued
- Question 5 (Multiple Choice): Determine the total amount of non-current assets given the following information: Inventories (€65,000), Software licenses (€100,000), Equipment (€320,000), Trade receivables (€40,000), Trade payables (€70,000), Cash at bank (€60,000), Equity (€150,000).
- Question 6 (Multiple Choice): Classify "cost of sales": Expense, expense and a cash payment, neither an expense nor a cash payment, a cash payment.
- Question 7 (Multiple Choice): Determine the direct effect on profit levels following a €20,000 increase in inventory purchases.
- Question 8 (Multiple Choice): Calculate the equity value on 31 December 2023 given 1 January 2023 equity (€280,000), net profit (€50,000), net cash flow (€30,000).
Questions (Part B - Break-Even Analysis)
- Question 9 (Multiple Choice): Calculate the effect on profits given a decrease in interest costs of €25,000 (holding other income elements constant).
- Question 10 (Multiple Choice): Given different accounting and equipment information about a purchase, determine the annual depreciation charge.
- Question 11 (Multiple Choice): Determine the carrying amount of non-current assets given a €500,000 opening balance, €60,000 depreciation charge, and €40,000 additions.
- Question 12 (Multiple Choice): Identify the location on the statement of cash flows for the withdrawal of €20,000 from a company for personal use.
Questions (Part B - Break-Even Analysis) Continued
- Question 13 (Multiple Choice): Determine the correctness of statements 1 and 2 regarding the balance of trade payables.
- Question 14 (Multiple Choice): Calculate the depreciation charge for new computer equipment acquired June 1, 2023, with a given cost, useful life, and residual value.
- Question 15 (Multiple Choice): Calculate total sales revenue from credit and cash sales given sales figures (credit €50,000, cash €10,000).
- Question 16 (Multiple Choice): Select an option to reduce operating expenses by 10%.
Questions (Part B - Break-Even Analysis) Continued
- Question 17 (Multiple Choice): Determine the location on the statement of cash flows when a company makes inventory purchases on credit.
- Question 18 (Multiple Choice): Determine the correctness of statements about net profit and its effect on equity and bank balances.
- Question 19 (Multiple Choice): Calculate the value of trade receivables as of December 31, 2023 given the beginning balance, credit sales, and cash collections.
- Question 20 (Multiple Choice): Calculate a company's gross profit given sales revenue, cost of sales, and purchases figures.
Questions (Part B - Break-Even Analysis) Continued
- Question 21 (Multiple Choice): Determine the effect on current assets after direct payment of €5,000 for inventory purchases.
- Question 22 (Multiple Choice): Calculate the cost of new inventory purchased given beginning, ending, and cost of sales figures.
- Question 23 (Multiple Choice): Determine the account in which rent expenses are recorded.
- Question 24 (Multiple Choice): Calculate the amount repaid on a €5,000,000 loan with 10-year repayment at 6% interest.
Questions (Part B - Break-Even Analysis) Continued
- Question 25 (Multiple Choice): Calculate the effect on profit levels after a customer payment for previously credit sales.
- Question 26 (Multiple Choice): Determine where a net cash flow of €50,000 is recorded in the financial statement.
- Question 27 (Multiple Choice): Determine the correctness of statements about the reporting of office equipment.
- Question 28 (Multiple Choice): Calculate the ending balance of a loan given the beginning balance, repayments, and interest expenses.
Questions (Part B - Break-Even Analysis) Continued
- Question 29 (Multiple Choice): Determine the effect on the financial statements (balance sheet) from repaying a loan.
- Question 30 (Multiple Choice): Determine the location on the statement of cash flows where a company makes a salary payment.
- Question 31 (Multiple Choice): Given the break-even point and margin of safety, calculate expected visits.
- Question 32 (Multiple Choice): Identify the type of cost that is directly connected to business activity.
Questions (Part C - Capacity)
- Question 33 (Multiple Choice): Calculate the margin of safety given the expected number of visitors and break-even point.
- Question 34 (Multiple Choice): Identify the less risky cost structure.
- Question 35 (Multiple Choice): Calculate the number of t-shirts to be sold per day to break even given sales price, cost of sales, and fixed costs.
- Question 36 (Multiple Choice): Calculate the required additional revenue to increase profit by a specified amount given revenue, variable and fixed costs information.
Questions (Part C - Capacity) Continued
- Question 37 (Multiple Choice): Determine the cost classification for €4000 monthly insurance payments.
- Question 38 (Multiple Choice): Calculate the break-even point in the number of visitors for an event given the ticket price, food/drink spending per visitor, fixed cost, and variable cost per visitor.
- Question 39 (Multiple Choice): Classify the fixed fee an event organiser pays per visitor to the venue owner.
- Question 40 (Multiple Choice): Given contribution per visitor, fixed cost, and variable cost per visitor, calculate the break-even point.
Questions (Part C - Capacity) Continued
- Question 41 (Multiple Choice): Calculate the standard cost price of one overnight stay given information about occupancy, fixed costs, and variable costs.
- Question 42 (Multiple Choice): Identify correct answers about ways to increase a restaurant's capacity (statement 1: adding seats, statement 2: extending hours)
- Question 43 (Multiple Choice): Determine correctness of statements about standard cost price accuracy.
- Question 44 (Multiple Choice): Calculate the capacity utilization rate for a theme park restaurant given seat utilization, operating days, and total visitor counts.
Questions (Part C - Capacity) Continued
- Question 45 (Multiple Choice): Calculate the duration of one ride on a rollercoaster given wagon size, train composition, and boarding times (exclude boarding times).
- Question 46 (Multiple Choice): Identify the correct statement(s) on unintended excess capacity and its effects.
- Question 47 (Multiple Choice): Estimate the maximum weekly capacity of a cinema given its opening hours, number of halls, seating per hall, and closure days.
- Question 48 (Multiple Choice): Determine the additional wagons required to increase capacity by a minimum.
Questions (Part D - Numeracy)
- Question 49 (Multiple Choice): Calculate the capacity utilization rate of a football stadium over 19 home games.
- Question 50 (Multiple Choice): Determine the accuracy of statements 1 and 2 about unintended and intended excess capacity in the context of theme parks.
- Question 51 (Multiple Choice): Calculate the savings from choosing the lower-cost supplier for stage equipment, given details of cost, delivery, and import duty, considering the exchange rates.
- Question 52 (Multiple Choice): Calculate the cost required for flooring renovation work given area dimensions, non-tiling areas, and material costs, including wastage allowance.
Questions (Part D - Numeracy) Continued
- Question 53 (Multiple Choice): Estimate the cost of ingredients required for a set number of cookies given different ingredient quantities and costs (including butter, sugar, eggs, oats, raisins).
- Question 54 (Multiple Choice): Compare the cost of electricity and gas contracts for your business (supplier A and B) giving the rate, fixed cost, and expected usage for electricity (kWh) and gas (m^3.)
- Question 55 (Multiple Choice): Determine the cheapest parking option given the cost per hour and per 10 minutes for different parking lots, considering various rates.
- Question 56 (Multiple Choice): Calculate the number of beer barrels required for an event given the capacity of each barrel, average beer consumption per visit, and the expected number of drinks.
Questions (Part D - Numeracy) Continued
- Question 57 (Multiple Choice): Calculate the total cost to budget for a pay/click online advertising campaign given different price tiers depending on the frequency of clicks.
- Question 58 (Multiple Choice): Calculate the discount percentage on a train ticket for a child given the regular price, supplement, and total cost of the trip for two people(child and another person)
- Question 59 (Multiple Choice): Calculate the required working hours to maintain the same gross salary given monthly salary figures and differing numbers of hours for different roles.
- Question 60 (Multiple Choice): Calculate the effective tax rate for a gift considering a tax-exempt portion.
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