“oe Renan a2 Managing Cost and Fance pd i ea was @ “eeewombers ‘BBM Co has general overneads of $148,200 forthe month of March. Its expected that theso wil increaso at 2.25% per month unt December. Overheads are pad the month after they are ncurred. What isthe cash outfow in June for overheads (to the nearest $)2 | task resrooesoeais @ aaa ‘Which of the following should be considered wien deciding on the most appropriate method of istributing a report? (1) Time (2) Confidentaity (8) Record keoping (4) Cost ‘and 2 only 4,2nd 4 only 3 and 4 only 4,2.3and4‘seat Test rose “etnies ‘A manufacturing company makes thee products using the same machine for each product. A budget forthe ‘next yea has been prepared as follows, onthe assumption thal production capacity willbe suffcent to meet the known sales demand Product rN 8 © ‘Sales demand (units) 500 400 300 s s s ‘Sales revenue 10.000 20,000 15,000 Vaviabe costs 4000 150006000 Feed costs 4000 20007850 Proft 2000 = ag 1.350 ‘Machine hours por writ 2 5 4 ‘Machine time wil be insufcint to moet sales demand in ful {tthe company wanted to maximise its annual profit in what order should it prioritise production and ‘sales ofthe three products (In descending order of priority)? Product ©, product 8, product A Product, product A product 8 Product A, product B, product C Product B, product. product A yr Test Popes ets oar a “feat hamgerd bos ee waz naeging cossandtinance Which of the following Is an appropriate cost unit fora coach travel company? Operating cost ofa cosch station Fuel cost Cost por passenger kiometre Cost of a coach diver1 Test Props Der =... —a ro aa | Which of the following ls NOT correct regarding methods of business communication? Memos perform the seme function internally as alter does externally Confidential information shouldbe iransmited by fax Email can be used for extemal communication Cost maybe a consideration when deciding the best communication method Te Semana ‘Az Managing Cots and Finance ES... 2mans 18855 ‘a Tost Progress oetas @ een e Which ofthe following are reasons for preparing a cash budget? (1) To highlight possible shortages of cash so that necessary steps can be takon to address the shonage (2) To noghignt possibe surplus cash whicn management coud invest in terest. bearing assets (®) To hahah any expected reductions in poftso that management can teke acton to restore pros “Time Remaining MA2-Managing Costs and Finance 2. o> = on @ Discounted cash fo analysis being apped toa project wth te following results Rate of interest (% per annum) [Net present value (8) 8 9.362 19 (2015) Using the above results what Is the best approximation ofthe intemal rate of retum of the project? 119% 141% 138% 206%oT) “Testers a tun anaging Coats and Fence femeael cussion amare, What is by-product? ‘Aproduct that can be further processed ‘A prod! that has isigniicant saleable value compared with He joint products ‘product tha has no saleable valve ‘Awaste product that has to be disposed af at a cost +9605 Test rogress Deas Sosare cael * ° “oat umber SS. Maz Menaging Costs and Finance Which ofthe following isthe most appropriate basis for apportioning the canteen costs in a factory? Direct wages Direct labour hours Number of fciory employees Indirect lbourRours uaz Menagng Costs an Finance ‘Sep 7 Aug 18 “eat umber [Xr ‘Which of the following may be used to support claims for overtime payments fo salaried stat? Employee record cards sob cards Teesheets Payslns 15527 TetPogen Dos Sep 7 Ag, Which of the following is calculation ofthe minimum inventory control level? Re-order evel minus maximum usago in maximum lad tmo FRe.o1de level minus average usage in average lad time Re-order quantiy minus maximum usage in maximum lead time Ro-order quantty plus o-order evel minus minimum usage in minimum lead imo @sor "eat eres Sep og 8 ne) “atomserd BON co amu nee a rzmmepng ons andtnance Which ofthe following are objectives of cash and cheque handling procedures? (1) All monies received are recorded and banked within soven days (2) Payments aro property authorised (2) Cash forecasts are reconcied (4) The duties of receiving and banking are segregated 4 and2 2and3 2 and 4 1.3end4 “ave Ramaing MA2 Managing Costs and Finance EB. . rel ® ses 1h Test Progress Details cor age ee Costs have been recorded atthe fllawing three output levels Production output 100,000 units 105,000 unis 110,000 units Tal costs 207,000 $213,000, 218.200 Using the high-ow method what Is the variable cost per unit (to two decimal places)? | Toe teeg TSE Cn |) ‘Are each of the following statements relating to types of cash transaction true or false? Tru False Revenue items generally relate tote jong tem functoning such as raising money from Shareholders, or acquiing non-current assets Exceptional toms are unusual, for example the coss of closing down part ofa businessWhich ofthe following are justifications forthe widespread use of computers inthe provision of ‘management information? (1) Speed of processing @) Accuracy of processing (@) Volume and complexity of processing requirements rene and Soni 4.2and3 4 and 3 ony TineReniane lice ‘Sep 17 Aug 18 acca} fusions zane tszae Tetons ona palit esiey Th lores aor conto account for a por conan he flowing surmanyiomaton : 000 eee wr Peeters cee eee 8 pening ventory in ste 6 reer 2 ‘There wete no inventory discrepancies in the period What accounting entry correctly records the Issue of direct materials from stores? Dr Work in progress $287,000 Cr Stores lade account $287,000 account Dr Stores ledger account $313,000 Cr Work in progress account $313,000 Dr Slores ledger account $257,000 Cr Work mn progiess account $287,000 DrWorkinpromess $313,000 Cr Stores ledger account 919,000 :“Te production wages ina company for petod include overtime premium paid to direct operatives. The company polcy isto treat overbme premium as adrect cost ‘What are the correct bookkeeping entries to account fr the overtime premium? Dr Workin progress CcrPrecuction overhead DrProducton overhead Cr Wages Dr Workin progress Woes DrProduction overhead Cr Workin progress eng TT ux sanagng Cote nd Face gu. us Tr ‘a Test Proms Dee @ “eat Namser3 \What term is used for the arbitrary sharing of overheads among cost centres? a ae ——— oa 5... 7 == xs @ Which statement is true with reference tothe following profivvolume (PIV) chart? vote companys Company Aas a higher contbution to sales ratio than Company 5 Company A has iower break even sales revenue than Company 8 Company A has higher prot than Company B Company A has higher fired costs then Company 8Te Reatng a2 Manogng Cost and France Lita omnes aman as yes @ “etwomber’s A business is considering a project requiring an investment of $200,000 naw and with estimated cash inflows of ‘$23,000 per annum in perpetuity The fist cash inflow would be received in ane year's time, The cat of capital is 10% per annum, ‘What is the net present value of te investment? 3.000 20.000 $2200 ‘20000 i er fait) oneson 21 mans tank stress @ Ec reaaane e “Thete are seven key ciara which guide a bank's decsion about whether or not ta land monay to a customer “These are called the canons of lending Which ofthe following are included inthe canons of ending? (1) E-stabishing the margin of profit (2) An assessment of he borrower's ability fo repay a loan (3) Estabising the purpose ofthe borrowing ‘and 9 only 2and3 only ‘and 2 only 4,2end3 ‘ae Reina iz unig CousandFnace ucson2 —— tmate Seo Aug 8 tone Test Propem Denn para Which of the following statements concerning feedforward and feedback control isiare true? (1) Feeatorward and feedback contol both take place alr a varance is reported (2) Feecorwars and feedback coir! are bath concerned with uncontolable variances only eter statemant Both statements Statement 1 only ‘Statement 2 only018 Wrst ropees Date @ “feat umber EE _. <= wastes @ In which ofthe following would service costing be MOST appropriate? ‘Component manufacturer ‘Chemical manufacturer Supermartet Hosoi “we Remain = 2 Managing Costs and Fiance re EE _. marks 185 1h Test Progress Octas Seana e ‘A company manufactures and sols tae products. Product dotais are as follows: Product Ag) BI) Cis) ‘Contribution por unit soo 725 880 [Not profit per unit 230 240 260 Contribution permachine hour 250-240. 220 [Not prot por mactine hour 07 08 065 ‘Machine hours availabe in the next periog wil not be suffcient to meet production requirements, There are no product speciic fixed costs What should be the order of priority for production inorder to maximise profit? Product ©, product A, product 8 Product A, product B, product © Product C, product B, product A Product B, product A, product ©Ss. 1h Terres Dts @ “Tyo foliowing is an extract ram thelist of accounts f a washing machine manutactuer Direct materials rect abour Drect expenses Production overheads cost codes 100-1900 22000 -2900 ‘3000 -3999 4000 - 4909 Which TWO ofthe following are coded correctly? [Code 2480: Wages of production department supervisor 5 Code 2160: Wages of operatives who work onthe product © Code 1670: Cleaning materials ‘A shop has budgeted to make the folowing purchases fom is suppers: Month January February Maren Aoi 8 9,000 22000 95.000 88,000 1k Test Pomens Det (5 "Code 3020: Royalties tor component used in manuractured product Maz Managing Costs and Finance sep t7 Aug 18 “eet umber “Tha shop budgets to pay for 75% os purchases inthe month of purchase, 20% nthe month ante purchase ‘and 5% inthe second mont afer purchase ‘What is the shop's budgeted payments figure for March? sd‘son ia terrors Des @ ethene ‘A company which manufactures and sels single product has the folowing sales end production data for a period Units Progucton 20.100 Sales 18,900 “There's no opening inventory. Profit has been caiculated forthe period using both absorption costing and marginal costing Which absorption profit and marginal profit igures are consistent with the above production and sales data? $10,000 12000 arial post ‘Absorption prot Toe teeg AEST Ac aanaing Costs and Fence A Sep 17 Aug 18 ad ee el ew wigs @ “Te folowing data refers oa parca ventory tem Receipts (units) Issues (units) ‘Total cost (8). Day 200 1100 Day 00 Daye 190 a0 Day7 wo “The weighted average method is used to value inventory issues. A revised weighted average pice is calculated aftr each purchase ‘At what cost price per unt (to two decimal places) will the Issue on Day 7 be made? 85.54 3957 $558 85.60Tray 4 TestProges onans @ Which of the following Is normally treated as a direct labour cost? CContolabe ile time Uncontrllabie ial time (Overtime premium at he speci request of a customer (Gyerime premium due to a femporary backog in production 1 Ter Promess Dems @ Az Monaing Costs and Finance Sep 17 Ag 18 “fat umber © Go produces a single product. The budgeted fixed production overheads forthe period are $360,000 The udgeted output for he paod is 6 000 unts. Opening inventory tthe start of te perod consisted of #50 units {nd dosing inventory atthe end ofthe period consisted of 300 units. The profi for the period under absorption costing was $100,000, What wae the profit forthe period using marginal costing principles? $100,560 $67,000 09.450 138,000 ‘Accompany manufactures and sels four products. Details areas folows: Contribution per unt [Net prot per unt Contribution per machine hour Net profi per machine hour Pas) 160 46 50 14 1h TosrPromese brs @ Product ais) RIS) 145 176 49 52 48 44 18 13, 8) 190 50 38 10 Machine hours available inthe nex! period wil not be suficient to meet production requirements. There are no Product-spectic xed costs \What should be the order of priority for production inorder to maximise profit? Pars QPRs Rsap S.RRO‘Would job costing be appropriate in each ofthe following manufacturing environments? Yes No Products re mass produced or inventory Producton ' cared ut in accordance wih the special requremants of ach customer Tie Reming rananain cons anatiance CoN Sept Aug ts Ee ueton’ imate MS Test Peed apse | ae “Tne managemant accounts of AB Co show the folowing expenses for June 20x0 cost. Co) "New company vehice 16.000 Painting company logo on vehicle 400 Ful for company vehicle 300 Whats the total capital expenditure forthe month? sd) ene sszaeningcogsantrnnce ‘aueston3#—2mane 14858 te Testrrogress Deans @ are (ea What is flexible budget? ‘A budget that can be used for several purposes ‘A budget that is changed to reflect the actus! evel of activity ‘A budget that is adjusted to reflect changing prices ‘A budget that is revised to reflect changes as they occur Ts) ora |e oem TN 1x2 Managing Cost and France gE. aal(® ‘What i an exception report? Arepor highlighting favourable variances ‘Arepot highlighting adverse variances ‘Aepot of variances ofa certain magnitude ‘A epot prepared as and when required rater than routnalyne seg it EMM voces @ 0 kts Pepen me Sa ‘Accompany had opening inventors of 17,000 kg and closing inventories of 13,500 kg. Profi for he period using ‘marginal costing was $124,200 ‘The xed ovethead absorption rate was $3 perk What was the profit using absorption costing? $89,700 3119700 3194700 104 700 “oe ea w2mamginnConsndtinne EB _. Ime EM etapa ep Auge Which ofthe following correctly describes a sunk cost? ‘cost unaffected by fuctuations inthe level of actly ‘Acost which i eleven for decision making ‘Acost whichis relevant in decision making ‘A potential costo be spent inthe current period “Time Remon So ‘MA2 Managing Costs and Finance Pan Ss © Ee uestons® 2s 1025, 1 Test Popes Deis @ coir tog i Which ofthe following isare likely to be classified as cash for management accounting purposes? (1) Petty cash @) Bank account balances (2) Marketable secunites only only ‘and 2 only 1 2and 3tance Tes romero pacar ee, ae na ux Manan Cote nd Fance Ss . e Which TWO ofthe following may result in fixed overheeds being over absorbed? ‘Act below budget ‘Actty above budget Exponature below budget Expenature above buaget roe eee TT rz manana con andFnnce unten amas tame Tes omer Det Spr hug ee, Sextanbers Z.Go makes a sole product and incurs fied costs of $9,000 per month. The variable cost per unt is $3.00 and fact uni sels for $7.00, Monthly sales demands 8,000 units |What s the break-even point in monthly sales units? — ‘enone 2 nag Cast a ance Fabel esionst kat 84S Testes Des corr aes © Manfectring process costs fo $17,070 opto. 8,000 of aw materials wore processed wih te toiowng est "0 Completa good ouput 8.100 Noma! oss 1.200 Abnormal gan 360 What was the cost perkg (to two decimal places]? sd Teron TN sz rangna Comsat race See Aug i & eestond? mats tS Test Proaess es cour Aaa Is each of the following statements relating to process costing true or false? True False Normal losses are credited to the process sccount atthe cost per unit ncurred on normal producton Abnormal gains are dobitod othe process account at tho cost por unt incutred on nowmal producton05 kes pene Sa ene seg et EMM verona @ Is each of the following statements, about cash management in the public sector, true or false? True False Public sector organisabons are free fo invest surplus funds in any investment ‘Legisiaton requires public sector organisations to ean a minimum rato of intrest on all investments ance ‘sep 17 Aug 18 “eat hmger “ae Reina iz unig Cons antFnace @ Cucston at tmats Which of the fellowing correctly describes the concept of leading and lagging? Raising share capital to improve cashflow ‘Shortoning te working capital cycle by obtaining money fiom customers as soon as possible, and taking as much ctedt from supplors as possbio Revising cash forecasts on a prindic basis increasing the working capital cycle by nceasing customer cred and paying supplies as Soon as possible scnaiing Maz Managing Cots and Finance cca re =e a estrogen De @ “fat Namser3 ‘An accountancy practce had an overhead budget of $21,060 fora period, Actual overnead expenditure in the period was $21,720. Overieads are absorbed on the basis of chen hours worked which tolled 2.975 inte etd and resulted in undor absorption of $345, |What was the budgeted overhead absorption rate per client hour? | t4a2t er) i lacca x E cd “est Nomber3 '5.400 unis ofa company’s single product were sold for a total revenue of $140,400. Fixed costs in to period were $39,420 and nel prof was $1,880, What was the contribution per unit (to two decimal places)? sdpac eee es ie De Sore You have been asked by the fnance manager to store the monthly management accounts unl tne senior ‘management meeting. The infarmatin s contgental and ony selected inaivcuals are allowed to $60 i Which ofthe following isthe MOST appropriate method of storing the information? Save a soft copy on the company's computer system in accordance with company IT policy and protect the fie wath a password rina hard copy and ieave i on your dask Pos a Sot copy to the public area of he company's wabsite Llsave hard copy ina drawer by your desk that cannol be locked neon Ta Yr9 Cot and anes a. n2sanaing Coisentfiomen ‘ons Testo De ecrariety . Test Number3 ‘Acompany fs inthe process of bringing @ new producto market and has incur development costs of $35,000 to dala. Further costs of $28,000 ville requed to complete the development of tne product “Marketing spend for tno past six months was $16,000 andi is expected tnat exponss in Is area wil be $22,000 forthe nex sixth period. In deciding whether to continue with the development and marketing of the new product, what isthe relevant cost? sd ‘ae Renting iz unig Cons antFnace @ Cucsen) —— tmate ton37 "eat roe Del ‘Sep 17 Aug 18 aaa ) “esthmeer3 ‘Assuming thatthe investment is not held until maturity, and there is no inflation, which ofthe following have a risk of fluctuation in the capital value? (1) Cetfeate of deposit 2) Government stock @) Bank deposit tand2 ‘eniy ends tendon ea : netenso man tenons oon Which ofthe following could cause an adverse labour efficiency variance? More effcient use of mates Use of unrsined labour Purchase of higher piced materals of standard qualty Use ofa higher grade of labour