QU EST IONS ounting for management 17 mins 1.1 Whih of the following statements about qualities of good information is false? It should be relevant for its purposes It should be ommuniated to the right person It should be ompletely aurate It should be timely 1.2 The sales manager has prepared a manpower plan to ensure that sales quotas for the forthoming year are ahieved. This is an example of what type of planning? Strategi planning Tatial planning Operational planning Corporate planning 1.3 Whih of the following statements about management aounting information is/are true? 1 They must be stated in purely monetary terms 2 Limited ompanies must, by law, prepare management aounts 3 They serve as a future planning tool and are not used as an historial reord 1, 2 and 3 1 and 2 2 only None of the statements is true 1.4 Whih of the following statements is/are orret? 1 management ontrol system is a term used to desribe the hardware and software used to drive a database system whih produes information outputs that are easily assimilated by management. 2 n objetive is a ourse of ation that an organisation might pursue in order to ahieve its strategy. 3 Information is data that has been proessed into a form meaningful to the reipient. 1, 2 and 3 1 and 3 2 and 3 3 only 1.5 Good information should have ertain qualities. Whih of the following are qualities of good information? 1 Complete 2 Extensive 3 Relevant 4 urate 1, 2 and 3 1, 3 and 4 2 and 4 ll of them bw--vj 5 Li.we«>Mmi
1.6 Monthly variane reports are an example of whih one of the following types of management information? Tatial Strategi Non-finanial Operational 1. 7 Whih of the following statements IS/ar, 1 Strategi planning is arried out by front llno managers. 2 Non-finanial information Is rolovant to management aou nting. 1 is true and 2 is false 2 is true and 1 is false oth are true oth are false (Total = 14 marks) 6 trwj IWNNGMmi
QU EITION fj Soures of data 2.1 Whih of the following is/are primary soures of data? (i) (ii) 12 mins Historial reords of transport osts to be used to prepare foreasts for budgetary planning The nnual bstrat of Statistis, published by the Offie for National Statistis in the United Kingdom ata olleted by a bank in a telephone survey to monitor the effetiveness of the bank's ustomer servies (i) and (ii) (i) and (i) only only 2.2 The following statements relate to different types of data (i) (ii) (iv) Seondary data are data olleted espeially for a speifi purpose isrete data an take on any value Qualitative data are data that annot be measured Population data are data arising as a result of investigating a group of people or objets Whih of the statements are true? (i) and (ii) only (ii) and only (ii) and (iv) only and (iv) only 2.3 Whih of the following statements are not true? II Ill IV If a sample is seleted using random sampling, it will be free from bias. sampling frame is a numbered list of all items in a sample. In luster sampling there is very little potential for bias. In quota sampling, investigators are told to interview all the people they meet up to a ertain quota. I, II, Ill and IV I, II and Ill II and Ill II only 2.4 Whih of the following sampling methods require a sampling frame? (i) (ii) (iv) Random Stratified Quota Systemati (i) and (ii) only (i), (ii) and only (i), (ii) and (iv) only only 2.5 Whih of the following explains the essene of quota sampling? Eah element of the population has an equal hane of being hosen Every nth member of the population is seleted Every element of one definable sub-setion of the population is seleted None of the above (Total = 1 marks) ~ lwni«lmii 9
QUESTIONS ~ Cost lassifiation 26 mins 3.1 firm has to pay a 2 per unit royalty to the inventor of a devie whih it manufatures and sells. How would the royalty harge be lassified in the firm's aounts? Selling expense iret expense Prodution overhead dministrative overhead 3.2 Whih of the following would be lassed as indiret labour? ssembly workers in a ompany manufaturing televisions stores assistant in a fatory store Plasterers in a onstrution ompany onsultant in a firm of management onsultants 3.3 manufaturing firm is very busy and overtime is being worked. How would the amount of overtime premium ontained in diret wages normally be lassed? Part of prime ost Fatory overheads iret labour osts dministrative overheads 3.4 Whih of the following items would be treated as an indiret ost? Wood used to make a hair Metal used for the legs of a hair Fabri to over the seat of a hair Staples to fix the fabri to the seat of a hair 3.5 Over whih of the following is the manager of a profit entre likely to have ontrol? (i) (ii) (iv) Selling pries Controllable osts pportioned head offie osts Capital investment in the entre ll of the above (i), (ii) and (i), (i i) and (iv) (i) and (ii) 3.6 Whih of the following best desribes a ontrollable ost? ost whih arises from a deision already taken, whih annot, in the short run, be hanged. ost for whih the behaviour pattern an be easily analysed to failitate valid budgetary ontrol omparisons. ost whih an be influened by its budget holder. speifi ost of an ativity or business whih would be avoided if the ativity or business did not exist. ~ ijhig- 13
.7 Whih of the following items might be a suitable ost unit within the redit ontrol department of a ompany? (I) (li) Stationery ost Customer aount Cheque reeived and proessed Item (i) only Item (ii) only Item only Items (ii) and only 3. Whih of the following best desribes a period ost? C ost that relates to a time period whih is deduted as expenses for the period and is not inluded in the inventory valuation. ost that an be easily alloated to a partiular period, without the need for arbitrary apportionment between periods. ost that is identified with a unit produed during the period, and is inluded in the value of inventory. The ost is treated as an expense for the period when the inventory is atually sold. ost that is inurred regularly every period, eg every month or quarter. 3.9 ompany employs four supervisors to oversee the fatory prodution of all its produts. How would the salaries paid to these supervisors be lassified? s a diret labour ost s a diret prodution expense s a prodution overhead s an administration overhead 3.1 ompany manufatures and sells toys and inurs the following three osts: (i) (ii) Rental of the finished goods warehouse epreiation of its own fleet of delivery vehiles Commission paid to sales staff Whih of these are lassified as distribution osts? (i) and (ii) only (i) and only (ii) and only (i), (ii) and 3.11 Whih of the following desribes a ost entre? unit of output or servie for whih osts are asertained funtion or loation for whih osts are asertained segment of the organisation for whih budgets are prepared n amount of expenditure attributable to a partiular ativity (Total = 22 marks) IJ Cost behaviour 46 mins 4.1 Fixed osts are onventionally deemed to be: Constant per unit of output Constant in total when prodution volume hanges Outside the ontrol of management Easily ontrolled 14 f!!)j) ll.wltlo Mmo
QUESTIONS 4.2 The following data relate to the overhead expenditure of a ontrat leaners at two ativity levels. Square metres leaned 13,5 15,95 Overheads 4,65 97,5 What is the estimate of the overheads if 1,3 square metres are to be leaned? 96,99 11,35 112,267 115,39 The following information relates to questions 4.3 to 4. 7 Level of ativity Graph 1 Level of ativity Graph 2 Level of ativity Graph 3 Graph 4 Level of ativity Level of ativity Graph 5 Level of ativity Graph 6 Whih one of the above graphs illustrates the osts desribed in questions 4.3 to 4. 7? 4.3 linear variable ost - when the vertial a~s represents ost inurred. Graph 1 Graph 2 Graph 4 Graph 5 4.4 fixed ost - when the vertial axis represents ost inurred. Graph 1 Graph 2 Graph 3 Graph 6 4.5 linear variable ost - when the vertial axis represents ost per unit. Graph 1 Graph 2 Graph 3 Graph 6 4.6 semi-variable ost - when the vertial axis represents ost inurred. Graph 1 Graph 2 Graph 4 Graph 5 ~ LwHIIoMIIx 15
4.7 step fixed ost - when the vertial axis represents ost inurred. Graph 3 Graph 4 Graph 5 Graph 6 4. ompany has reorded the following data in the two most reent periods. Total osts of prodution 13,5 1,3 Volume of prodution Units 7 1,1 What is the best estimate of the ompany's fixed osts per period? 13,5 13,2 5,1 4, 4.9 prodution worker is paid a salary of 65 per month, plus an extra 5 pene for eah unit produed during the month. How is this type of labour ost best desribed? variable ost fixed ost step ost semi-variable ost II 4.1 What type of ost is supervisor salary osts, where one supervisor is needed for every ten employees added to the staff? fixed ost variable ost mixed ost step ost 4.11 The following information for advertising and sales has been established over the past six months: Month 1 2 3 4 5 6 Sales revenue ' 155 125 2 175 15 225 dvertising expenditure ' 3 2.5 6 5.5 4.5 6.5 Using the high-low method whih of the following is the orret equation for linking advertising and sales from the above data? Sales revenue = 62,5 + (25 x advertising expenditure) dvertising expenditure = - 2,5 + (.4 x sales revenue) Sales revenue = 95, + (2 x advertising expenditure) dvertising expenditure= - 4,75 + (.5 x sales revenue) 16 WJ ilimngmm
QUESTIONS 4.12 total ost is desribed as staying the same over a ertain ativity range and then inreasing but remaining stable over a revised ativity range in the short term. What type of ost is this? fixed ost variable ost semi-variable ost stepped fixed ost 4.13 ompany inurs the following osts at various ativity levels: Total ost 25, 312,5 4, Using the high-low method what is the variable ost per unit? 25 3 35 4 tivity level units 5, 7,5 1, 4.14 The following diagram represents the behaviour of one element of ost: Total ost '------------- --- --+Volume of ativity Whih ONE of the following statements is onsistent with the above diagram? C nnual fatory power ost where the eletriity supplier sets a tariff based on a fixed harge plus a onstant unit ost for onsumption but subjet to a maximum annual harge. Weekly total labour ost when there is a fixed wage for a standard 4 hour week but overtime is paid at a premium rate. Total diret material ost for a period if the supplier harges a lower unit ost on all units one a ertain quantity has been purhased in that period. Total diret material ost for a period where the supplier harges a onstant amount per unit for all units supplied up to a maximum harge for the period. 4.15 n organisation manufatures a single produt. The total ost of making 4, units is 2, and the total ost of making 2, units is 4,. Within this range of ativity the total fixed osts remain unhanged. What is the variable ost per unit of the produt?. 1.2 1.25 2. lruv l.l.wa!igmii 17
4.16 When total purhases of raw m1terl1l exeed 3, units In any one period then all units purhased, inluding the initial 3,, are Invoied at a lower oat per unit. Whih of the following graphs Is onslstont with tho behaviour of the total materials ost in a period? ~---+---- UNI 3, '----'----!-----+ UNITS 3, "-----t-------+ UNITS 3, IL..._-----+--------. UNITS 3, 4.17 The total ost of prodution for two levels of ativity is as follows: Level 1 Level 2 Prodution (units) 3, 5, Total ost() 6,75 9,25 The variable prodution ost per unit and the total fixed prodution ost both remain onstant in the range of ativity shown. What is the level of fixed osts? 2, 2,5 3, 3,5 4.1 The following data relate to two ativity levels of an X-ray department in a hospital: Number of X-rays taken Overheads Fixed overheads are 2, per period. What is the variable ost per X-ray?.6 15.5 25 3,75 4,5 269,75 4,75 273,625 4.19 n organisation has found that there is a linear relationship between sales volume and delivery osts. It has found that a sales volume of 4 units orresponds to delivery osts of 1, and that a sales volume of units orresponds to delivery osts of 12,. What are the delivery osts for a sales volume of 7 units? 5 3,5, 11,5 (Total = 3 marks) 1 ~ l.wni«l MII
QUESTIONS EJ Presenting information 7 mins 5.1 The ost of materials for produt are as follows. Material W: 2,25 Materia l X: 3, Material Y: 3,6 Material Z: 15 If the material proportions were displayed on a pie hart, how many degrees would material Y represent? 9 degrees C 12 degrees 144 degrees 24 degrees The following information relates to questions 5.2 to 5.3 Number of ie-reams sold pril May June July Mint ho h ip 6 76 725 9 Choolate 3 335 36 525 Strawberry 175 26 31 475 lueberry 75 9 1 9 5.2 The data may be illustrated by the following hart. What type of hart is it? 1, ' g (/) E ~ 6. ~ 4 ~ 2 o pril.j.._.l_l._j Mint-ho Choolate Strawberry lueberry Simple bar hart Multiple bar hart Component bar hart Ogive 5.3 Whih one of the following statements is true? Sales of mint ho h ip rose steadily over the four months Total sales fell in the month of July fter May, sales of strawberry began to ath up with sales of hoolate Sa les of blueberry rose in May and July (Total = 6 marks) ~ IWIK- 19