CAIE A-Level Business AS 5.4.3 Cost Information Uses Questions

Practise calculating cost and profit changes and using average, marginal, total or contribution information to support pricing, performance and special-order decisions.

Exam points

Use cost information to support profit, pricing, performance and special-order decisions.

[Maximum number: 3]

Refer to Table 1.1. Calculate the change in GT's total costs between 2020 and 2022.

Refer to Table 1.1. Calculate the change in GT's total costs between 2020 and 2022.

Indicative content.

- Formula: total costs = total revenue - profit (1)

- Calculation of cost in either 2020 or 2022 (1)

- Costs in 2020: $\$ 3.4 \mathrm{~m}-\$ 0.9 \mathrm{~m}=\$ 2.5 \mathrm{~m}$

- Costs in 2022: $ 2.8 m-0.2 m=$ 2.6 m

- Change in costs: $ 2.6 m-$ 2.5 m=$ 0.1 m(1 OFR )

Answer = $0.1m (3)

Accept answer as a percentage 4\% (with \% sign) as full marks

Exemplar and annotations

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CAIE A-Level Business AS 5.4.3 Cost Information Uses Questions question 1