CIMAPRA17-BA2-1-ENG

A company’s cash budgetary plans show that there will be surplus cash for three months of the forthcoming year. Which THREE of the following would be appropriate management actions in this situation?A . Offer a longer credit period to new customers to boost salesB . Purchase new non-current assets to...

An increase in the variable cost per unit, will cause the point at which the line plotted on a profit/volume (PV) graph intersects the horizontal axis to:A . Move to the leftB . Move to the rightC . DoubleD . Stay where it isView AnswerAnswer: B

The management accountant has completed the appraisal of an investment in new office equipment. It has now been discovered that the cost of capital used in the appraisal should have been higher. What will be the effect on the calculated net present value (NPV) and the payback period?A . NPV...

PQR Manufacturing Ltd. has £3,000,000 of fixed costs for the forthcoming period. The company produces a single product 'X', which has a selling price of £75 per unit and total cost of £50. 75% of the total cost represents variable costs. What are the break-even units?A . 80,000B . 240,000C...

CORRECT TEXT Refer to the exhibit. The following data relates to two activity levels of a department. Overhead absorption is on the basis of machine hours. The variable overhead rate per hour is £4.50. The amount of fixed overhead, to the nearest £000, is:View AnswerAnswer: £871

In the process account, the accounting treatment of the value of the abnormal gain is:A . Credit Process account Debit Abnormal Gain accountB . Debit Process account Credit Abnormal Gain accountC . Credit Process account Debit Normal Loss accountD . Debit Process account Credit Normal Loss accountView AnswerAnswer: B

A company currently allows a discount of 20% to customers who pay at the time of purchase. If 30% of customers pay immediately, the extra sales needed in July to increase the cash receipts in that month by £6,000 are:A . £7500B . £20000C . £25000D . £30000View AnswerAnswer: C

Fixed costs can best be described as:A . Costs which are difficult to budget accuratelyB . Costs which remain constant, within a relevant range, when activity levels changeC . Costs which never changeD . Costs which are uncontrollableView AnswerAnswer: B

CORRECT TEXT Refer to the exhibit. Patchit Limited operates a job costing system. They have been asked to quote for a rush job that will require to be done in overtime hours. It is estimated that the job will incur the following costs: Production overheads are absorbed on a direct...

In investment appraisal, the internal rate of return isA . the target rate of return for all investment proposalsB . the rate at which a project’s cash inflows is equal to its cash outflowsC . the rate at which the present value of a project’s cash inflows is zeroD ....