CIMA CIMAPRO19-P01-1 Actual Free Exam Questions & Community Discussion
200 units each of components F, G and H are required next period.
All three components are made by skilled labour of which only 4,000 hours are available.
An external supplier is able to supply any requirements of the components.
No inventories are held.
Data for the three components are as follows:
In order to minimise cost, how many units of component H should be purchased from the external supplier?
All three components are made by skilled labour of which only 4,000 hours are available.
An external supplier is able to supply any requirements of the components.
No inventories are held.
Data for the three components are as follows:
In order to minimise cost, how many units of component H should be purchased from the external supplier?
Correct Answer: C
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EFG is a small business making raspberry jam to sell at local markets. It has recently been approached by a major supermarket to produce a special order for the supply of lemon curd.
Two of the ingredients required are sugar and preservatives, both of which are in inventory.
The sugar has a historic cost of $4 per kg and a replacement cost of $5. It is in regular use for the production of the raspberry jam.
The factory has switched to organic processes and the preservatives are no longer required.
The historic cost of the preservatives was $3 per kg and the replacement cost is $2.50 per kg.
The preservatives can be re-sold to a local competitor for $1 per kg if they are not used in this order.
Which TWO of the following should be included in determining the relevant cost of the special order?
Two of the ingredients required are sugar and preservatives, both of which are in inventory.
The sugar has a historic cost of $4 per kg and a replacement cost of $5. It is in regular use for the production of the raspberry jam.
The factory has switched to organic processes and the preservatives are no longer required.
The historic cost of the preservatives was $3 per kg and the replacement cost is $2.50 per kg.
The preservatives can be re-sold to a local competitor for $1 per kg if they are not used in this order.
Which TWO of the following should be included in determining the relevant cost of the special order?
Correct Answer: B,C
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Forecast sales demand of product W next period is 6,800 units. Product W requires 5 kg of material Y, seven hours of skilled labour and six hours of semi-skilled labour.
Availability of resources for next period is forecast as follows:
No inventories are held.
What is the principal budget factor for next period?
Availability of resources for next period is forecast as follows:
No inventories are held.
What is the principal budget factor for next period?
Correct Answer: B
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A manager has to decide between four mutually exclusive projects, A, B, C and D:
Using the above information, which Project would a risk seeking manager choose?
Using the above information, which Project would a risk seeking manager choose?
Correct Answer: D
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A company produces trays of pre-prepared meals that are sold to restaurants and food retailers. Three varieties of meals are sold: economy, premium and deluxe.
Discuss the benefits of flexible budgeting for planning and control purposes.
Select all the true statements.
Discuss the benefits of flexible budgeting for planning and control purposes.
Select all the true statements.
Correct Answer: A,C,E
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A company sells and services photocopying machines. Its sales department sells the machines and consumables, including ink and paper, and its service department provides an after sales service to its customers. The after sales service includes planned maintenance of the machine and repairs in the event of a machine breakdown. Service department customers are charged an amount per copy that differs depending on the size of the machine.
The company's existing costing system uses a single overhead rate, based on total sales revenue from copy charges, to charge the cost of the Service Department's support activities to each size of machine.
The Service Manager has suggested that the copy charge should more accurately reflect the costs involved. The company's accountant has decided to implement an activity-based costing system and has obtained the following information about the support activities of the service department:
Calculate the annual profit per machine for each of the three sizes of machine using activity-based costing.
The company's existing costing system uses a single overhead rate, based on total sales revenue from copy charges, to charge the cost of the Service Department's support activities to each size of machine.
The Service Manager has suggested that the copy charge should more accurately reflect the costs involved. The company's accountant has decided to implement an activity-based costing system and has obtained the following information about the support activities of the service department:
Calculate the annual profit per machine for each of the three sizes of machine using activity-based costing.
Correct Answer: B
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Which costing method, used in just-in-time (JIT) production systems, attaches cost directly to output rather than following the flow of product through the production process?
Correct Answer: A
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A company sells three products A, B and C in a ratio of 2:2:3.
Each unit of A,B and C earns a contribution of $4.00, $2.00 and $4.00 respectively. Production fixed costs are $69,000 each month and selling fixed costs are $13,000 each month.
The company holds no inventory. The management accountant wants to know the total number of units needed to break-even. However, he is unsure about how to calculate the weighted average contribution per unit or what category of fixed cost to use.
Place the amounts given to complete the table in order to calculate the total number of units to break even.
Each unit of A,B and C earns a contribution of $4.00, $2.00 and $4.00 respectively. Production fixed costs are $69,000 each month and selling fixed costs are $13,000 each month.
The company holds no inventory. The management accountant wants to know the total number of units needed to break-even. However, he is unsure about how to calculate the weighted average contribution per unit or what category of fixed cost to use.
Place the amounts given to complete the table in order to calculate the total number of units to break even.
Correct Answer:
A company sells and services photocopying machines. Its sales department sells the machines and consumables, including ink and paper, and its service department provides an after sales service to its customers. The after sales service includes planned maintenance of the machine and repairs in the event of a machine breakdown. Service department customers are charged an amount per copy that differs depending on the size of the machine.
The company's existing costing system uses a single overhead rate, based on total sales revenue from copy charges, to charge the cost of the Service Department's support activities to each size of machine.
The Service Manager has suggested that the copy charge should more accurately reflect the costs involved. The company's accountant has decided to implement an activity-based costing system and has obtained the following information about the support activities of the service department:
Calculate the annual profit per machine for each of the three sizes of machine, using the current basis for charging the costs of support activities to machines.
The company's existing costing system uses a single overhead rate, based on total sales revenue from copy charges, to charge the cost of the Service Department's support activities to each size of machine.
The Service Manager has suggested that the copy charge should more accurately reflect the costs involved. The company's accountant has decided to implement an activity-based costing system and has obtained the following information about the support activities of the service department:
Calculate the annual profit per machine for each of the three sizes of machine, using the current basis for charging the costs of support activities to machines.
Correct Answer: C
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A healthcare company specializes in hip, knee and shoulder replacement operations, known as surgical procedures. As well as providing these surgical procedures the company offers pre operation and post operation in-patient care, in a fully equipped hospital, for those patients who will be undergoing the surgical procedures.
Surgeons are paid a fixed fee for each surgical procedure they perform and an additional amount for any follow-up consultations. Post procedure follow-up consultations are only undertaken if there are any complications in relation to the surgical procedure. There is no additional fee charged to patients for any follow up consultations. All other staff are paid annual salaries.
The company's existing costing system uses a single overhead rate, based on revenue, to charge the costs of support activities to the procedures. Concern has been raised about the inaccuracy of procedure costs and the company's accountant has initiated a project to implement an activity-based costing (ABC) system.
The project team has collected the following data on each of the procedures.
Calculate the profit per procedure for each of the three procedures, using the current basis for charging the costs of support activities to procedures.
What was the profit for the knee procedure?
Surgeons are paid a fixed fee for each surgical procedure they perform and an additional amount for any follow-up consultations. Post procedure follow-up consultations are only undertaken if there are any complications in relation to the surgical procedure. There is no additional fee charged to patients for any follow up consultations. All other staff are paid annual salaries.
The company's existing costing system uses a single overhead rate, based on revenue, to charge the costs of support activities to the procedures. Concern has been raised about the inaccuracy of procedure costs and the company's accountant has initiated a project to implement an activity-based costing (ABC) system.
The project team has collected the following data on each of the procedures.
Calculate the profit per procedure for each of the three procedures, using the current basis for charging the costs of support activities to procedures.
What was the profit for the knee procedure?
Correct Answer: C
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