Budgeting and budgetary control — AS & A Level Accounting (9706) questions by topic

Cash budgets, flexible budget statements, budgeting advantages, and variance analysis covering sales volume, fixed overhead and materials or labour anchor this page's 5 questions, taken from 2023 and 2024 papers. Marks here sit at a consistent 25, and calculate, assess, draw, state and explain move you from building a budget to judging what the variances mean.

Because opening balances, discounts and production units are easy to carry forward incorrectly between months, submit your full budget or reconciliation for instant marking so each figure is checked before it feeds into the next month's calculation.

What examiners look for

Examiners repeatedly found candidates unable to derive supplier payment amounts, and depreciation was often mishandled in the cash budget's operating expenses.
A recurring criticism concerns discount received, irrecoverable debts, and fixed overhead treated incorrectly, plus variances calculated in the wrong direction or omitted for direct materials and labour.
Many candidates failed to carry the correct closing balance forward as the next month's opening balance, or mixed dollars, units and kilos without adjusting for opening and closing inventory.
Strong answers, according to the reports, dealt correctly with cash and credit sales, gave balanced justification by weighing both options, and produced fully correct fixed overhead expenditure variance calculations.
Reports praise candidates who gave the required advice with calculations and comments to support it, and who prepared production budgets to a good standard with no common errors.