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Year Month Part Question Notes

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1.Prepare the original budgeted Profit and Loss Account for next
year.
12 BUDGETING
(5 marks)
2.Prepare the revised (and separate) budgeted Profit and Loss
Account for each of the different scenarios outlined by the different
2010 June 1 members of the Board – (1) to (3) above. 12 BUDGETING

(16 marks)
3.Compute the selling price required to meet Molly’s target of
£1,000,000 profit – as per (4) above.
9 COST CHARACTERISTICS
(9 marks)
1.Prepare a financial assessment of the two options, taking into
account the time-span of the two options, and make a clear
recommendation on the preferred financial option. 15 INVESTMENT DECISIONS

(18 marks)
2.Outline any other qualitative factors that should be considered in
the decision-making process.
15 INVESTMENT DECISIONS
(4 marks)
2010 June 2

3.Most businesses agree that budgeting is a central part of their

planning process. Outline the advantages and disadvantages of the
budgeting process. 12 BUDGETING

(8 marks)

1.Prepare the accounting equation as at 31 October in a tabular

format, detailing all of the transactions for October and
incorporating the various adjustments identified by Jim.
1 ACCOUNTING EQUATION
(17 marks)

2.Prepare the Profit and Loss Account for October.

1 ACCOUNTING EQUATION
2009 Dec 1 (7 marks)
3.Prepare the Balance Sheet as at 31 October.
1 ACCOUNTING EQUATION
(7 marks)
4.Identify any issues of concern that emerge from your review of
the Profit & Loss Account and Balance Sheet.
1 ACCOUNTING EQUATION
(4 marks)
1.If all aspects of the Treasurer’s financial data are accurate, what
is the forecast financial outcome for this year’s show?

(16 marks)
2.Ignoring the contribution from programme sales, how far can
CADS allow the audience numbers to decline before an overall loss
is incurred?
2009 Dec 2
(4 marks)

3.The cost–volume–profit model depends on a number of key

assumptions. Outline these assumptions and assess their validity in
real world scenarios. 9 COST CHARATERISTICS

(5 marks)

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Year Month Part Question Notes

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1.Compute the following ratios for Birkdale for both 2008 and 2009:
i.Quick ratio
ii.Gross profit margin
iii.Profit margin
iv.Return on total assets
v.Return on owners’ equity
6 FINANCIAL RATIOS
vi.Fixed to current asset ratio
vii.Average collection period
viii.Inventory turnover
ix.Dividend cover
2009 June 1 x.Times interest earned
(15 marks)

2.Based only on the ratio analysis above, identify and assess

Birkdale’s financial strengths and weaknesses. 6 FINANCIAL RATIOS
(10 marks)
3.Identify and comment on any other aspects of Birkdale’s recent
financial performance that may give cause for concern in an
6 FINANCIAL RATIOS
acquisition process.
(5 marks)

1.Prepare the monthly Cash Budgets for the quarter to 31 August.

12 BUDGETING
(25 marks)

2.In view of the funding requirements highlighted by the Cash

2009 June 2 Budget, outline the actions that the chief financial officer may take
to ensure that she meets the demands of the CEO and also that 12 BUDGETING
the company does not break its overdraft limit.

(5 marks)

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Year Month Part Question Notes

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1.Prepare a Cash Flow Statement for the year to 30 November
2008 based on the draft Accounts in Appendix 1.
4 CASH FLOW
(18 marks)
2.Prepare a brief report for circulation to the board, outlining

a.The principal reasons for the company’s increase in its cash

reserves during the year.
4 CASH FLOW
2008 Dec 1 b.Any other relevant comments on significant cash movements
during the year.

(10 marks)
3.Compute the company’s profitability ratios as compared to those
available for Heavystone Limited in Appendix 2. Make any relevant
comments. 6 FINANCIAL RATIOS

(7 marks)
1.Using the net present value approach, assess the financial merits
of each supplier’s equipment and comment on which supplier is
preferable from a quantitative perspective only. 15 INVESTMENT DECISIONS

(16 marks)
2.Compare the relative attraction of each project using the basic
Payback period approach. Comment on whether these
2008 Dec 2 assessments comply with the company’s stated payback policy. 15 INVESTMENT DECISIONS

(5 marks)

3.Identify the key factors in this investment assessment where the

application of sensitivity analysis could assist the overall evaluation.
15 INVESTMENT DECISIONS
(4 marks)

1.Prepare the Accounting Equation, in a tabular format, as at 31

May 2008, incorporating all of the relevant year-end adjustments.
1 ACCOUNTING EQUATION
(16 marks)

2.Prepare the Profit and Loss Account for the year to 31 May 2008,
including relevant comparisons with the budget for that period.
Comment on any significant differences between actual and
2008 June 1 1 ACCOUNTING EQUATION
budgeted performance.

(13 marks)

3.In preparing for a meeting with your bankers, what are the main
points that you would wish to make in defence of the company’s
current financial position? 1 ACCOUNTING EQUATION

(6 marks)

1.Compute the ROI for each of the subsidiaries for next year–

i.based on the original draft budgets

14 ACCOUNTING FOR DIVISIONS
ii.and then inclusive of the impact of the new proposals.

(20 marks)

2.
2008 June 2
i.Review each of the subsidiaries’ proposals and advise whether or
not you would recommend proceeding with them, detailing your
reasons.
14 ACCOUNTING FOR DIVISIONS
ii.Identify whether or not their implementation will result in conflict
between the holding company and the subsidiaries.

(5 marks)

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Year Month Part Question Notes

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1.Prepare the original budgeted Profit and Loss Account for next
year.
12 BUDGETING
(5 marks)

2.Prepare the revised (and separate) budgeted Profit and Loss

Account for each of the different scenarios outlined by the different
2007 Dec 1 members of the family in (1) to (3) above. 12 BUDGETING

(16 marks)

3.Compute the selling price required to meet Sandy’s target of

£700 000 profit – as per (4) above.
9 COST CHARACTERISTICS
(9 marks)

1.Prepare a full variance analysis of all variable cost elements,

together with the relevant sales variances.
13 STANDARD COSTING
(15 marks)

2.Suggest possible causes for each of the variances identified.

13 STANDARD COSTING
(5 marks)
2007 Dec 2

3.‘Budgeting can be an imprecise exercise.’ Discuss this comment

and outline the benefits and potential disadvantages of the
budgeting process. 12 BUDGETING

(10 marks)

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Year Month Part Question Notes

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1.Define and compute the following key ratios for both companies.
i.Current ratio
ii.Quick/acid test ratio
iii.Gross profit margin
iv.Profit margin ratio
v.Return on capital employed
6 FINANCIAL RATIOS
vi.Return on owners’ equity
vii.Average collection period
viii.Debt ratio
2007 June 1 ix.Dividend cover
x.Earnings per share
(20 marks)

2.Detail both companies’ major operating strengths and

weaknesses, as identified from the ratio analysis. Prepare a brief
summary on your conclusions from the ratio analysis. 6 FINANCIAL RATIOS

(15 marks)

1.It appears that the budget outcome may be threatened by the

availability of labour. Assess the position for both skilled and
unskilled labour, identifying any relevant shortfall of labour hours.
(5 marks)
2.Given your findings in 1 above, identify how many units of each
product should be produced in order to achieve the maximum
budgeted profit.
2007 June 2 (11 marks)
3.Prepare a profit statement, setting out the maximum budgeted
profit from 2 above.
(6 marks)

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Year Month Part Question Notes

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4.Advise the company whether or not it should use Presslee
Supplies to meet any unfulfilled market demand from 2 above.
Support your view with relevant computations.
(3 marks)
1.Prepare the Accounting Equation as at 30 November 2006,
detailing the impact of each of the transactions and adjustments in
November on the accounting records. 1

(16 marks)

2006 Dec 1 2.Prepare the Profit and Loss Account for November 2006.
1
(6 marks)

3.Prepare the Balance Sheet as at 30 November 2006.

1
(8 marks)

1.Prepare the Cash Budget for the quarter to 30 September.

12 BUDGETING
(20marks)

2006 Dec 2
2.In view of the funding requirements highlighted by the Cash
Budget, outline the actions that the chief financial officer can take to
ensure that the company does not break its overdraft limit. 12 BUDGETING

(10 marks)

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Year Month Part Question Notes

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1.Prepare a Cash Flow Statement for the year to 31 May 2006
based on the draft Accounts in Appendix 1.
4 CASH FLOW
(17 marks)

2.Prepare a brief report for circulation to the board, outlining:

a.The principal reasons for the company's difficulties in retaining its
cash reserves during the year.
b.Relevant comments on all other significant cash movements 4 CASH FLOW
2006 June 1 during the year.

(9 marks)

3.Compute and comment on the following ratios for both 2005 and
2006.
a.Gross profit margin
6 FINANCIAL RATIOS
b. Inventory turnover

(4 marks)

Compute the ROI for each of the subsidiaries for next year
based on the original draft budgets;
and then inclusive of the impact of the new proposals. 14 ACCOUNTING FOR DIVISIONS

(22 marks)

2006 June 2
2. a) Review each of the subsidiaries' proposals and advise
whether or not you would recommend proceeding with them,
detailing your reasons.
b) Identify whether or not their implementation will result in conflict 14 ACCOUNTING FOR DIVISIONS
between the holding company and the subsidiaries.

(8 marks)

In advance of the meeting, compute the following ratios for

Pearsman for both 2004 and 2005:
Current ratio
Quick ratio
Gross profit margin
Profit margin
Return on capital employed 6 FINANCIAL RATIOS
Return on owner's equity
Fixed to current asset ratio
Average collection period
Times interest earned
2005 Dec 1 Dividend cover
(15 marks)

From the ratio analysis above, identify Pearsman's financial

strengths and weaknesses. 6 FINANCIAL RATIOS
(10 marks)

Compute the impact of Gerald's planned cost savings on

Pearsman's Profit Margin and Return on Capital Employed ratios.
Comment on the effect of these savings.
(10 marks)

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Year Month Part Question Notes

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Prepare a full variance analysis of all variable cost elements,
including the relevant sales variances.
13 STANDARD COSTION
(15 marks)

2005 Dec 2
Outline the advantages and perceived disadvantages of the
budgeting process.
12 BUDGETING
(10 marks)

Prepare the accounting equation as at 31 July in a tabular format,

detailing all of the transactions for the month and incorporating the
various adjustments identified by Cynthia. 1 ACCOUNTING EQUATION

(18 marks)
Prepare the Profit and Loss Account for July.
1 ACCOUNTING EQUATION
2005 June 1 (7 marks)
Prepare the Balance Sheet as at 31 July.
1 ACCOUNTING EQUATION
(7 marks)
From the financial statements, identify the company's principal
financial strengths.
1 ACCOUNTING EQUATION
(3 marks)
If the Bodgers Theatre Company is to meet its minimum objective
of not losing any money on the launch of their show, how many
tickets do they have to sell? Comment on whether you think this is
achievable.

(15 marks)

If the Bodgers Theatre Company wanted also to pay for their

Australian holiday, what price per ticket would they require to
2005 June 2 charge, assuming that they only managed to achieve the average
sales level of unpopular shows?

(6 marks)

In business, the budgeting process sometimes attracts adverse

criticism'. Outline its main advantages to any type of organisation.
12 BUDGETING
(4 marks)

Prepare an assessment of the two options under consideration and

make a recommendation to the directors on the preferred option.

(26 marks)

2004 Dec 1 Any investment appraisal process involves the identification of key
investment factors. Identify four key investment factors.
15 INVESTMENT DECISION
(4 marks)

Compute the break-even level of activity on the basis of last year's

results.

(7 marks)

2004 Dec 2
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Year Month Part Question Notes

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Carry out a quantitative assessment of the two separate options
suggested by the Marketing Director and make a recommendation
on which of these options will meet the objective set out by the
Chief Executive.
2004 Dec 2
(16 marks)

The Cost–Volume–Profit Analysis approach has a number of

assumptions. Outline these assumptions and indicate whether they
constrain the usefulness of the approach. 9 COST CHARACTERISTICS

(7 marks)

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Year Month Part Question Notes

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Compute and contrast the following key ratios for both companies:
Current ratio
Quick/acid test ratio
Gross profit margin
Profit margin ratio
Return on capital employed
Return on owners' equity 6 FINANCIAL RATIOS
Average collection period
Debt ratio
Dividend cover
2004 June 1 Earnings per share

(20 marks)

Prepare some brief notes for the Chief Executive outlining your
view of the financial status of McKenzie Hotels plc in comparison
with Milton Group. Detail both companies' major operating 6 FINANCIAL RATIOS
strengths and weaknesses as identified from the ratio analysis.
(10 marks)

Prepare detailed computations on:

Product cost and gross margin per unit for each product under the
present costing system.
(12 marks)
The effect of the implementation of an ABC approach on the
allocation of total factory overhead.
(8 marks)
2004 June 2
Product cost and gross margin per unit for each product under an
ABC approach to costing.
(6 marks)
Prepare brief notes summarising your approach and conclusions
on the effects of ABC approach in advance of the next meeting with
the General Manager.
(4 marks)

In order to assess the validity of the opinions of the Dunedin 6,

compute the following ratios for Dunedin for both 2002 and 2003:
Current ratio Quick ratio
Gross Profit Margin Profit Margin
6 FINANCIAL RATIOS
Return on Capital Employed Return on Total Assets
Inventory Turnover Average Collection Period
Times Interest Earned Debt ratio
(20 marks)

From the ratio analysis above, separate the ratios into:

those ratios which support the arguments of the Dunedin 6
2003 Dec 1 those ratios which counter the arguments of the Dunedin 6
Provide adequate supporting explanations and comments on each 6 FINANCIAL RATIOS
of the ratios to substantiate why they have been classified as either
(a) or (b). Make reference to industry averages, where appropriate.
(10 marks)

From the Accounts, your ratio analysis and extra information

available, comment on the general financial performance and
status of Dunedin Products plc and outline your opinion on the 6 FINANCIAL RATIOS
merits of the dissident shareholders' point of view.
(5 marks)

WWW 6 FINANCIAL RATIOS

WWW 6 FINANCIAL RATIOS
2003 Dec 2 Compute Sutherland's three key ratios for 2002 and 2003 and
compare them to the industry average, commenting on any
6 FINANCIAL RATIOS
variations.
(9 marks)

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Year Month Part Question Notes

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Prepare a cash flow statement for the year to 30 April 2003.
4 CASH FLOW STATEMENT
(20 marks)

Identify and comment on the major movements in cash over the

year.
2003 June 1 4 CASH FLOW STATEMENT
(6 marks)

Compute Sutherland's three key ratios for 2002 and 2003 and
compare them to the industry average, commenting on any
variations. 6 FINANCIAL RATIOS

(9 marks)

Prepare a brief report to the company, identifying:

the shortfall in direct labour hours capacity in June;

13 STANDARD COSTING
the deployment of direct labour hours across the products to
achieve maximum profitability in June.

(15 marks)
2003 June 2

Using the deployment of direct labour hours computed in 1(ii)

above, prepare the budgeted Profit and Loss Account for June. 12 BUDGETING

(10 marks)

Prepare the accounting equation as at 30 September in a tabular

format, detailing all of the transactions for the quarter and
incorporating the various adjustments identified by Shelby. 1 ACCOUNTING EQUATION

(20 marks)

Prepare the Profit and Loss Account for the three months to 30
September 2002.
1 ACCOUNTING EQUATION
2002 Dec 1 (6 marks)

Prepare the Balance Sheet as at 30 September 2002

(6 marks)
1 ACCOUNTING EQUATION
From the financial statements, identify the company's principal
financial strengths.

(3 marks)

Assess the relative attraction of the projects by applying the Net

Present Value technique of investment appraisal.
15 INVESTMENT DECISIONS
(17 marks)
Compare the relative attraction of each project using the Payback
period approach.
2002 Dec 2 15 INVESTMENT DECISIONS
(5 marks)
Identify the areas of the investment appraisal where sensitivity
analysis could assist the overall evaluation.
15 INVESTMENT DECISIONS
(3 marks)
Prepare a Cash Flow Statement for the year to 30 November 2001
based on the draft Accounts in Appendix 1.
4 CASH FLOW
(16 marks)

2001 Dec 1
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Year Month Part Question Notes

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Prepare a brief report for circulation to the board, outlining the
principal reasons for the failure of the company to improve its cash
position despite earning profits over the year. 4 CASH FLOW
2001 Dec 1 (8 marks)

Prepare a brief report for circulation to the board, identifying the

issues related to the additional items included within Appendix 2.
Include your recommendations on whether and how these items
should be included within the final accounts to 30 November 2001.

(6 marks)

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Year Month Part Question Notes

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Compute and contrast the following key ratios for the two companies and
ESCTA.

Current ratio

Quick ratio

Gross profit margin

Profit margin ratio

Fixed to current asset ratio

Inventory turnover

Average collection period

Debt ratio

(16 marks)

Prepare some brief notes on NBSG's ratio performance against both

Donkins and the ESCTA average, identifying and commenting on:
2002 June 1 6 FINANCIAL RATIOS
areas in which NBSG's performance exceeds Donkins or ESCTA
average.

areas in which Donkins' performance exceeds both NBSG and ECTA

average.

(8 marks)

Since both NBSG and Donkins are quoted companies, compute and
comment on the following relevant stock market ratios.

Earnings per share

Price-earnings ratio

Dividend cover ratio

(6 marks)

Outline the limitations in the application of ratio analysis.

(5 marks)

Prepare a delegate fee pricing structure to assist AUKD to achieve

break-even in running the conference. AUKD have asked for fee
levels for delegate numbers from 70 to 120 – in bands of 10.

(20 marks)
2002 June 2 9 COST CHARACTERISTICS
Outline the key assumptions which underpin the cost–volume–profit
analysis approach to decision-making.

(5 marks)

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