Question 1

A consulting firm uses standard absorption costing. The budgeted sales volume was 10,000 billable hours. The actual sales volume achieved was 9,500 billable hours. The standard profit per billable hour is $8.

Calculate the sales volume profit variance. State your answer as a number followed by 'A' or 'F' (e.g., 4000 A).

Accepted Answer

1. Find the difference between budgeted volume and actual volume. 2. Multiply the difference by the standard profit per unit.

Question 2

What mistakes do candidates make on this ACCA question?

Accepted Answer

Using standard contribution instead of standard profit (which would be the marginal costing approach).

How to approach this question

Full Answer

Common mistakes

Practice the full ACCA MA — Management Accounting Practice Exam 4

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