9706_m25_qp_42

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, Cambridge International AS & A Level ¬Wz> 4mHuOªEŠ^{5€W ¬ixtRž—c‹m|˜_@Z‹‚ ¥•…UuUeU¥e5……•¥5¥U * 4 4 6 3 3 2 6 4 7 8 * ACCOUNTING 9706/42 Paper 4 Cost and Management Accounting February/March 2025 1 hour You must answer on the question paper. You will need: Insert (enclosed) INSTRUCTIONS ● Answer all questions. ● Use a black or dark blue pen. ● Write your name, centre number and candidate number in the boxes at the top of the page. ● Write your answer to each question in the space provided. ● Do not use an erasable pen or correction fluid. ● Do not write on any bar codes. ● You may use an HB pencil for any diagrams, graphs or rough working. ● You may use a calculator. ● You should present all accounting statements in good style. ● You should show your workings. INFORMATION ● The total mark for this paper is 50. ● The number of marks for each question or part question is shown in brackets [ ]. ● The insert contains all of the sources referred to in the questions. This document has 12 pages. Any blank pages are indicated. DC (PQ) 340825/3 © UCLES 2025 [Turn over

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, Cambridge International AS & A Level ¬Wz> 4mHuOªEŠ^{5€W ¬ixtRž—c‹m|˜_@Z‹‚ ¥•…UuUeU¥e5……•¥5¥U * 4 4 6 3 3 2 6 4 7 8 * ACCOUNTING 9706/42 Paper 4 Cost and Management Accounting February/March 2025 1 hour You must answer on the question paper. You will need: Insert (enclosed) INSTRUCTIONS ● Answer all questions. ● Use a black or dark blue pen. ● Write your name, centre number and candidate number in the boxes at the top of the page. ● Write your answer to each question in the space provided. ● Do not use an erasable pen or correction fluid. ● Do not write on any bar codes. ● You may use an HB pencil for any diagrams, graphs or rough working. ● You may use a calculator. ● You should present all accounting statements in good style. ● You should show your workings. INFORMATION ● The total mark for this paper is 50. ● The number of marks for each question or part question is shown in brackets [ ]. ● The insert contains all of the sources referred to in the questions. This document has 12 pages. Any blank pages are indicated. DC (PQ) 340825/3 © UCLES 2025 [Turn over

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, 1 Read Source A in the insert. (a) Discuss: (i) whether or not apportioning the factory rent on a per unit basis is the most suitable way to apportion that cost. DO NOT WRITE IN THIS MARGIN ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... ..................................................................................................................................... [2] (ii) whether or not setting selling prices by use of a fixed mark-up is the most suitable way to set them. DO NOT WRITE IN THIS MARGIN ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... ..................................................................................................................................... [2] Additional information The company is considering starting production of a third product, Z. This would affect costs and DO NOT WRITE IN THIS MARGIN revenues as follows: 1 The number of units of X and Y being manufactured would be unchanged. Production of Z would be 2000 units per year. 2 The direct costs of X and Y would be unchanged. The total direct cost of one unit of Z would be $34. 3 Products X and Y would continue to have the same number of quality inspections and machine set-ups. Product Z would have 500 inspections and 50 set-ups. Because of the increase in the number of quality inspections, an additional inspector would DO NOT WRITE IN THIS MARGIN have to be employed. This would double the total cost of quality inspections per year. The increase in the number of machine set-ups would increase the total cost, which would become $13 020. 4 The increase in production would necessitate the rental of additional floor space. This would increase the total cost of factory rent which would become $30 000. This would continue to be apportioned on a per unit basis. ĬÕú¾Ġ´íÈõÏĪÅĊßù·þ× © UCLES 2025 ĬéöóÓĪĜñÜöċėàÕðĢăĂ 9706/42/F/M/25 ĥÅĕÕμμĥμÕĥĥÅąÕąõÅÕ DO NOT WRITE IN THIS MARGIN

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, 1 Read Source A in the insert. (a) Discuss: (i) whether or not apportioning the factory rent on a per unit basis is the most suitable way to apportion that cost. DO NOT WRITE IN THIS MARGIN ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... ..................................................................................................................................... [2] (ii) whether or not setting selling prices by use of a fixed mark-up is the most suitable way to set them. DO NOT WRITE IN THIS MARGIN ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... ..................................................................................................................................... [2] Additional information The company is considering starting production of a third product, Z. This would affect costs and DO NOT WRITE IN THIS MARGIN revenues as follows: 1 The number of units of X and Y being manufactured would be unchanged. Production of Z would be 2000 units per year. 2 The direct costs of X and Y would be unchanged. The total direct cost of one unit of Z would be $34. 3 Products X and Y would continue to have the same number of quality inspections and machine set-ups. Product Z would have 500 inspections and 50 set-ups. Because of the increase in the number of quality inspections, an additional inspector would DO NOT WRITE IN THIS MARGIN have to be employed. This would double the total cost of quality inspections per year. The increase in the number of machine set-ups would increase the total cost, which would become $13 020. 4 The increase in production would necessitate the rental of additional floor space. This would increase the total cost of factory rent which would become $30 000. This would continue to be apportioned on a per unit basis. ĬÕú¾Ġ´íÈõÏĪÅĊßù·þ× © UCLES 2025 ĬéöóÓĪĜñÜöċėàÕðĢăĂ 9706/42/F/M/25 ĥÅĕÕμμĥμÕĥĥÅąÕąõÅÕ DO NOT WRITE IN THIS MARGIN

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, (b) Calculate the total annual cost of quality inspections if production of Z takes place. ................................................................................................................................................... ................................................................................................................................................... ................................................................................................................................................... DO NOT WRITE IN THIS MARGIN ............................................................................................................................................. [2] (c) Calculate the increase per year in the following costs which would occur if production of Z takes place. (i) machine set-ups ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... DO NOT WRITE IN THIS MARGIN ..................................................................................................................................... [2] (ii) factory rent. ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... ..................................................................................................................................... [2] DO NOT WRITE IN THIS MARGIN DO NOT WRITE IN THIS MARGIN Ĭ×ú¾Ġ´íÈõÏĪÅĊßû·þ× [Turn over © UCLES 2025 ĬéõôÛĠĘāÝĄöÒüÝìĢóĂ 9706/42/F/M/25 DO NOT WRITE IN THIS MARGIN ĥÅĥĕõÕąÕÅĕμÅąμĥμÕÕ

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, (b) Calculate the total annual cost of quality inspections if production of Z takes place. ................................................................................................................................................... ................................................................................................................................................... ................................................................................................................................................... DO NOT WRITE IN THIS MARGIN ............................................................................................................................................. [2] (c) Calculate the increase per year in the following costs which would occur if production of Z takes place. (i) machine set-ups ........................................................................................................................................... ........................................................................................................................................... DO NOT WRITE IN THIS MARGIN ........................................................................................................................................... ..................................................................................................................................... [2] (ii) factory rent. ........................................................................................................................................... ........................................................................................................................................... ........................................................................................................................................... ..................................................................................................................................... [2] DO NOT WRITE IN THIS MARGIN DO NOT WRITE IN THIS MARGIN Ĭ×ú¾Ġ´íÈõÏĪÅĊßû·þ× [Turn over © UCLES 2025 ĬéõôÛĠĘāÝĄöÒüÝìĢóĂ 9706/42/F/M/25 DO NOT WRITE IN THIS MARGIN ĥÅĥĕõÕąÕÅĕμÅąμĥμÕÕ