Free BA2 Exam Braindumps (page: 16)

Refer to the exhibit.



X Enterprises runs a private nursing home for the elderly. The company are concerned that bed occupancy rates have been falling over the past 2 years with a consequential effect on profit. They have drawn up a budget for next year as follows:

The nursing home currently charges $90 per patient day.

The nursing home operates at 7,500 patient days per year. In an effort to increase occupancy rates the company are proposing to reduce the current price by 10% and increase spending on advertising by $10,000 each year. What effect will this have on the margin of safety?

In a manufacturing company which produces a range of products, the production manager's salary would be classified as A.

The wages of a machine operator who is paid a guaranteed minimum wage plus a bonus for each unit produced would be described as A.

SP Limited operates an absorption costing system. It uses a predetermined overhead absorption rate based on machine hours. Budgeted factory overheads for the year were £1,080,000 but actual overhead incurred was £1,046,000. Budgeted machine hours were 120,000 and actual machine hours were 119,000.

Overheads for the period were.