AQA AS-Level Business: Operations management (7137) – Practice Questions

These are original questions written for Marlbridge, for revision and practice on this content. They are not reproduced past-paper questions, and they do not replicate the exam’s exact structure, question count or mark tariffs – examination boards hold copyright in their own papers. Use these alongside the official past papers from your board or school.

These questions cover operations management for AQA AS-Level Business (7137), section 3.2.2, checked on 5 November 2026 against AQA’s 7137/7138 specification, Version 1.1 (November 2025), which “the specification” means below. The businesses are invented. Learn the content first from the study guide or the revision notes. Course pages: the AQA AS Business hub and the printable checklist. Formulas are those in the specification’s annex.

Questions

1. State two operational objectives named in the specification. [2]

2. Define capacity utilisation. [2]

3. Salterforth Bikes assembled 1,800 bicycles last month with 15 employees. Total costs were £243,000 and the workshop can assemble 2,400 bicycles a month.

(a) Calculate labour productivity. [2] (b) Calculate unit cost. [2] (c) Calculate capacity utilisation. [2]

4. Upperby Fabrics had cost of sales of £540,000 last year. Its inventory was £40,000 at the start of the year and £50,000 at the end.

(a) Calculate the inventory turnover. [2] (b) Explain one reason why the firm might choose to hold buffer inventory (just in case) rather than use just in time. [2] (c) Upperby cuts its average inventory to £30,000 with no change in cost of sales. Calculate the new inventory turnover. [1]

5. Explain one benefit and one difficulty of Just in Time production for a small caterer. [4]

6. A café refit has four activities. A (strip out, 2 days) starts first. B (new kitchen, 5 days) and C (decorate, 3 days) both follow A. D (final inspection, 1 day) follows both B and C.

(a) Identify the critical path and the minimum project time. [2] (b) Calculate the float time for activity C. [2]

7. Thornhaugh Print completes 25,000 orders a year. Last year 4% had to be reprinted because of errors. Each reprint cost £18 in materials and labour.

(a) Calculate the annual cost of reprinting. [2] (b) Analyse two other consequences of poor quality for Thornhaugh Print. [4]

8. Skelmorlie Coffee roasts beans. Manual roasting has fixed costs of £6,000 a month and variable costs of £5.50 per kilogram. An automated roaster has fixed costs of £15,000 a month and variable costs of £2.50 per kilogram. Forecast demand is 4,200 kg a month, but it could fall to 2,400 kg.

(a) Calculate total cost at 4,200 kg for each method. [4] (b) Calculate the unit cost for each method at 4,200 kg. [2] (c) Recommend which method Skelmorlie Coffee should use. Justify your answer. [6]

9. Wyvernby Kitchens makes kitchens to order and uses its own vans for deliveries. Owning and running the vans costs £9,000 a month plus £14 per delivery. A contractor would charge £48 per delivery. Normal demand is 240 deliveries a month; in the peak season it is 300. Evaluate whether Wyvernby Kitchens should outsource its deliveries. [8]

10. Marnhull Gifts sells a hamper for £48. The bought-in food and packaging cost £19.20. Calculate the added value, in pounds and as a percentage of the selling price. [3]

11. Explain what is meant by quality assurance and why it might raise a firm’s costs. [4]

12. Ridgeley Plastics needs 10,000 mouldings a month. Supplier A charges £5.00 each, with a 95% on-time delivery record and a lead time of 8 days. Supplier B charges £5.40 each, with a 99% on-time record and a lead time of 2 days. Justify which supplier Ridgeley Plastics should choose. [6]

Answers

1. Any two of: efficiency, quality, volume of goods and services, flexibility, environmental impact. [1] [1] [2] Examiner insight: Repeating one objective in different words (for example “low costs” and “efficiency”) earns the mark once.

2. Actual output compared with the maximum output possible (capacity) [1], expressed as a percentage: actual output ÷ capacity × 100 [1]. [2] Examiner insight: “How much of the factory is used” on its own is vague; naming output and capacity makes the definition exact.

3. (a) Employee productivity = 1,800 ÷ 15 [1] = 120 bicycles per employee [1] (b) £243,000 ÷ 1,800 [1] = £135 per bicycle [1] (c) 1,800 ÷ 2,400 × 100 [1] = 75% [1] Examiner insight: Show the substitution so the method is visible, and give units, since “120” alone does not say what is measured.

4. (a) Average inventory = (40,000 + 50,000) ÷ 2 = £45,000 [1]; inventory turnover = 540,000 ÷ 45,000 = 12 times a year [1] (b) Buffer stock lets production continue if a supplier delivers late or demand rises suddenly [1], so Upperby does not lose orders or leave machines idle, which matters if its suppliers are unreliable [1]. (c) 540,000 ÷ 30,000 = 18 times a year [1] Examiner insight: Use average inventory, not the closing figure alone, unless only one figure is given.

5. Benefit: holding little inventory cuts storage costs and the cash tied up in ingredients [1], which matters to a small caterer with limited funds and little space [1]. Difficulty: any late delivery from a supplier leaves no stock to fall back on [1], so an event could be spoiled and customers lost [1]. [4] Examiner insight: A benefit or difficulty gains most when it is linked to the caterer; a general statement about “reducing costs” is only partly developed.

6. (a) A–B–D takes 2 + 5 + 1 = 8 days; A–C–D takes 6 days. The critical path is A–B–D [1] and the minimum project time is 8 days [1]. (b) C has an earliest start time of 2 and a latest finish time of 7 (D cannot start before day 7). Float = 7 − 3 − 2 [1] = 2 days [1]. [4] Examiner insight: Write the float formula (latest finish time − duration − earliest start time) before substituting; leaving out the earliest start time is the usual slip.

7. (a) 25,000 × 0.04 = 1,000 reprints [1]; 1,000 × £18 = £18,000 [1] (b) Any two developed consequences, for example: late delivery of the reprinted orders means customers may lose trust in the firm’s dependability [1], so some may switch to rivals and sales fall [1]; staff and machine time spent on reprints is time not spent on new orders [1], which reduces output and lowers capacity available for profitable work [1]. [4] Examiner insight: “Analyse” needs a chain of cause and effect, so each consequence should have a reason and a result for the business, not only a label such as “bad reputation”.

8. (a) Manual: 6,000 + 5.50 × 4,200 = 6,000 + 23,100 [1] = £29,100 [1]. Automated: 15,000 + 2.50 × 4,200 = 15,000 + 10,500 [1] = £25,500 [1] (b) Manual: 29,100 ÷ 4,200 = £6.93 [1]. Automated: 25,500 ÷ 4,200 = £6.07 [1] (c) At the forecast 4,200 kg the automated roaster is £3,600 cheaper a month [1]. The two methods cost the same at 3,000 kg (15,000 + 2.5q = 6,000 + 5.5q) [1], so below that level manual roasting is cheaper: at 2,400 kg manual costs £19,200 and automated £21,000 [1]. Automation also gives consistent quality and faster output, but needs heavy investment and may cause redundancies or loss of the craft appeal of hand-roasting [1]. Judgement: choose automation if demand is expected to stay above 3,000 kg [1], because the saving is certain only above that point; if demand is uncertain or seasonal, keep manual roasting or phase automation in [1]. [6] Examiner insight: A recommendation is credited when it is tied to a stated condition, here the volume at which costs are equal, rather than “automation is better because it is modern”.

9. At 240 deliveries own vans cost 9,000 + 14 × 240 = £12,360 against £11,520 for the contractor, so outsourcing saves £840 a month [2]. Costs are equal at about 265 deliveries (9,000 ÷ 34), so at the peak of 300 the vans cost £13,200 against £14,400, making own vans £1,200 cheaper [2]. Non-financial factors: a contractor frees capital and management time and copes with peaks, but Wyvernby loses control over timing, handling and customer contact, and a late or careless delivery harms its dependability and reputation [2]. Judgement: outsourcing is financially sensible for most of the year, but because quality of delivery matters to a made-to-order product, a sound decision is to outsource only if the contractor’s standards are guaranteed, or to keep the vans for peaks and use the contractor otherwise [2]. [8] Examiner insight: A strong evaluation uses the numbers to show when the answer changes, then weighs control and dependability against cost before it reaches a conclusion.

10. Added value = selling price less the cost of bought-in inputs [1]: £48 − £19.20 = £28.80 [1]; £28.80 ÷ £48 × 100 = 60% [1]. [3] Examiner insight: Give both forms when the question asks for both; leaving out the percentage loses the last mark even if the pound value is correct.

11. Quality assurance builds quality into every stage of the process, for example by checking suppliers, training staff and monitoring production, so faults are prevented rather than found at the end [2]. It can raise costs because training, better materials, more checks and new systems cost money before any savings from fewer returns appear [1], and extra time spent checking may slow output [1]. [4] Examiner insight: Describing quality assurance as “checking products at the end” shows confusion with inspection of finished goods, so stress prevention at every stage.

12. Cost: A is £50,000 and B is £54,000 a month, so B is £4,000 (8%) dearer [1]. Supplier A is late on about 500 of 10,000 mouldings (5%) [1], and its 8-day lead time means more stock must be held as a buffer [1]. Supplier B delivers faster and more reliably, which supports a dependable service and Just in Time ordering [1]. If Ridgeley’s customers value reliability more than price, B is justified; if margins are tight and a buffer is affordable, A may suit [1]. Judgement: choose B if late deliveries would cost more than £4,000 a month in stoppages and lost customers, and otherwise choose A [1]. [6] Examiner insight: A justification needs a stated criterion, such as the cost of late deliveries compared with the extra £4,000, rather than a statement that one supplier is simply better.

Where marks are usually lost

• Omitting units, or giving a percentage as a decimal.
• Dividing by the wrong figure: capacity instead of output, or variable cost instead of total cost for unit cost.
• Mixing time periods, such as monthly output with weekly capacity.
• Using closing inventory instead of average inventory in inventory turnover.
• Explaining Just in Time without applying it to the business in the question.
• Describing quality assurance as inspection at the end of production.
• Choosing manual or automated production without referring to the volume at which costs are equal.
• Ending an evaluation with advantages and disadvantages but no decision and no condition on which it depends.

Next steps

• Revise with the operations management revision notes and the study guide.
• See the AQA AS Business hub and the printable checklist.
• Take one of the free 10-minute diagnostics to find weak spots.
• Book a free trial class.

Frequently asked questions

Are these real AQA AS-Level Business past paper questions? No. They are original questions on section 3.2.2 of the AQA 7137 specification, written for revision; use them alongside the official AQA past papers.

How do I get full marks on an operations calculation? Write the formula, substitute the figures so the method is visible, and give the answer with units. Check the time periods match, for example monthly output against monthly capacity.

Should I use closing inventory or average inventory for inventory turnover? Use average inventory, which is opening plus closing inventory divided by two, unless the question gives only one figure. The specification formula is cost of sales divided by average inventories held.

What does an “analyse” question need in AQA Business? It needs a chain of cause and effect: each point should be developed through its consequences for the business in the case, not just stated.

How do I make a recommendation that earns the evaluation marks? Reach a clear decision and tie it to a stated condition, such as the output volume at which two methods cost the same. Ending with advantages and disadvantages but no decision loses marks.

Official syllabus

AQA AS and A-level Business (7137, 7138) specification, Version 1.1 (November 2025), for first teaching from September 2026: section 3.2.2 Operations management and Annex 7, Formulae and key data. Checked against these questions on 5 November 2026.