Which of the following is a relevant cost?
A. A sunk cost
B. A committed cost
C. An incremental cost
D. A historical cost
The following data are available for a company that produces and sells a single product.
The company's opening finished goods inventory was 2,500 units.
The fixed overhead absorption rate is $8.00 per unit.
The profit calculated using marginal costing is $16,000.
The profit calculated using absorption costing and valuing its inventory at standard cost is $22,400.
The company's closing finished goods inventory is:
A. 3,300 units
B. 1,700 units
C. 3,900 units
D. 8,900 units
Which of the following would NOT require taking into account the time value of money?
A. Deciding to make a long-term investment in a project on the basis of its payback period.
B. Selecting an investment project on the basis that it has a positive net present value (NPV).
C. Calculating the present value of a five-year annuity.
D. Taking a long-term investment decision on the basis of the project's internal rate of return (IRR).
Which TWO of the following are characteristics of Management Accounts? (Choose two.)
A. Governed by rules and regulations
B. Provide information to managers
C. Provide information needed by shareholders
D. Internally focused
E. Statutory requirement
A new product requires an investment of $200,000 in machinery and working capital. The total sales volume over the product's life will be 5,000 units. The forecast costs per unit throughout the product's life are as follows:
The product is required to earn a return on investment of 35%. What unit selling price needs to be achieved?
A. $54.00
B. $50.77
C. $47.00
D. $44.55
A management accountant has forecast the following cash inflows from four potential projects.
All four projects require the same initial investment and will last for four years. They all result in a positive net present value but only one of the projects can be undertaken. Which project should be selected?
A. Project A
B. Project B
C. Project C
D. Project D
The budget and actual cost statements for the production department for the latest period were as follows.
Notes.
1.
The 10% increase in production was required to meet unexpected additional sales demand.
2.
The production manager is responsible for negotiating the price of materials with suppliers.
3.
The normal working time is 900 hours per period. Any overtime worked above these 900 hours is paid at a premium of 50%. In preparing the flexible budget for the latest period, which TWO of the following statements are correct? (Choose two.)
A. The fixed costs should be flexed to $40,000 + 10% = $44,000.
B. The material quantity should be flexed to 60,000 + 10% = 66,000 kg.
C. The basic pay hours should not be flexed; they should remain at 1,000 hours.
D. The overtime hours should be flexed to (1,000 + 10%) - 900 = 200 hours.
E. The material price should be flexed to the actual figure of $3.10 per kg.
According to CIMA's Code of Ethics, CIMA members should not allow bias, conflict of interest of the influence of other people to override their professional judgement. This is an example of:
A. objectivity.
B. professional behaviour.
C. integrity.
D. professional competence and due care.
A company uses an integrated accounting system. The following data relate to the latest period.
At the end of the period, the entry in the production overhead control account in respect of under or over absorbed overheads will be:
A. $22,672 debit.
B. $2,208 credit.
C. $2,208 debit.
D. $22,672 credit.
Which THREE of the following are included in the Global Management Accounting Principles? (Choose three.)
A. Accountability
B. Influence
C. Value
D. Professional behaviour
E. Relevance
F. Integrity
