CAIE A-Level Business 5.4.2 Full and Contribution Costing

CAIE A-Level Business 5.4.2 Full and Contribution Costing
Cambridge International AS & A Level Business 9609 syllabus for exams in 2026, 2027 and 20282026–2028

Practise distinguishing full from contribution costing and analysing the assumptions and limitations that affect pricing, product continuation and special-order decisions.

How this is tested

  • define full costing as allocating direct and indirect costs to obtain a total product cost
  • calculate contribution as revenue minus variable cost and keep it distinct from final profit
  • analyse a limitation through cost allocation, fixed costs, spare capacity or non-financial factors

Question 2

Question 2(a)

(a)

Define the term full costing.

[ 2 ]

Question 2(b)

(b)

Explain one limitation of contribution costing.

[ 3 ]