Exam Details

  • Exam Code
    :CIMAPRO19-P02-1
  • Exam Name
    :P2 - Advanced Management Accounting
  • Certification
    :CIMA Certifications
  • Vendor
    :CIMA
  • Total Questions
    :202 Q&As
  • Last Updated
    :Oct 24, 2024

CIMA CIMA Certifications CIMAPRO19-P02-1 Questions & Answers

  • Question 51:

    A new product is being manufactured for the first time. The first unit required 600 minutes of labor to manufacture. It is expected that there will be a 90% learning curve for the first 20 units. The learning index for a 90% learning curve is

    0.152. Calculate the expected labor time to manufacture the 10th unit. Your answer should be given to the nearest whole minute.

    A. 360 minutes, 361 minutes, 362 minutes

  • Question 52:

    The following summarised financial statements have been prepared by JNM's North subsidiary for the year just ended:

    Calculate the North subsidiary's Residual Income, assuming that JNM's cost of capital is 10%. Give your answer to the nearest $ million.

    A. $24 million, 24000000

  • Question 53:

    GHY has two subsidiaries. GHY-Motor manufactures car engines and GHY-Build designs and assembles cars. In the car industry it is common for manufacturers to buy parts, including engines, from other manufacturers.

    GHY has granted GHY-Motor and GHY-Build full autonomy. GHY-Build is considering using an engine from another company for a new model that it is designing. GYY-Motor has a suitable engine, but it charges more than GHY-Build's

    preferred supplier.

    Which of the following statements is correct? Select ALL that apply.

    A. GHY should consider permitting GHY-Motor to charge part of the selling price on engines sold to GHY-Build to head office.

    B. Forcing GHY-Motor to grant a discount to GHY-Build could lead to dysfunctional behavior.

    C. There could be significant non-financial issues associated with GHY-Build's decision to buy another engine.

    D. Parent companies should never grant subsidiaries full autonomy on matters such as intra-group sales.

    E. The threat of dysfunctional behavior is largely theoretical and managers can be trusted to maximise shareholder wealth.

  • Question 54:

    Which of the following activities are included within activity based management (ABM)?

    1.

    Cost reduction

    2.

    Product design decisions

    3.

    Variance analysis

    4.

    Operational control

    5.

    Performance evaluation

    A. 3, 4 and 5 only.

    B. 1, 2 , 4 and 5 only.

    C. 1, 3, 4 and 5 only

    D. All of them.

  • Question 55:

    IOP's product is manufactured using a production process that is known to have a defect rate of 10%. IOP's quality control department has developed a test that has a 98% probability of classifying a non- defective item correctly and a 2%

    probability of classifying a non-defective item as defective. The same test has a 95% probability of classifying a defective item correctly and a 5% probability of classifying a defective item as non-defective.

    Calculate the proportion of IOP's output that will be classified as non-defective by the quality control department's test.

    Give your answer to one decimal place.

    A. 99.4 %

  • Question 56:

    SDF is a newly-established production company that is experiencing high staff turnover in its factory. The production department is studying the manufacturing process and its associated learning curve. Which of the following statements is correct?

    A. SDF's staff turnover will disrupt the observation and measurement of the learning curve.

    B. SDF's staff turnover will affect the learning curve.

    C. SDF's rapid staff turnover means that knowledge of the learning curve has little value.

    D. SDF can use the learning curve to determine labor budgets for the remainder of the first year of operation.

  • Question 57:

    Product WB currently sells for $13 per unit. Annual demand at that price is 20,000 units. If the price increases to $15, the annual demand falls by 500 units. What is the formula for the demand curve?

    A. Q = a - bP

    B. P = f(Q).

    C. Qd = a ?b(P

    D. P = a -b(Q)

  • Question 58:

    LL produces an item, the Z, for which the demand curve is estimated to be:

    P = 10 - 0.0001Q

    where, P is the unit price in $ and Q is the annual sales volume in units; Marginal revenue (MR) = 10 - 0.0002Q

    The variable cost of producing the Z is $2 per unit. The annual fixed costs of production are $110,000.

    What is the profit maximizing output level?

    A. 50,000 units

    B. 45,000 units

    C. 40,000 units

    D. 35,000 units

  • Question 59:

    Firefighters risk serious and potentially fatal accidents whenever they attend an incident. Which of the following statements is correct?

    A. The risk of serious accidents should be accepted in all but the most extreme incidents.

    B. The risk of serious accidents should always be accepted because that is what firefighters are paid to do.

    C. The risk of serious accidents should be avoided because the risk has a high probability and a high impact.

    D. Every incident should be the subject of a detailed and thorough risk assessment before the firefighters are permitted to respond.

  • Question 60:

    ZZZ is a divisionalised company that uses the balanced scorecard approach to monitor divisional performance. Each measure on the scorecard is classified as green (if they are better than expected), amber (if expectations have been met) or

    red (if they are poorer than expected). The Southern Division's scorecard shows that 90% of the measures are amber, 3% are green and 7% are red.

    All of the red classifications are listed under the Learning and Growth perspective and have arisen largely because the division has lost a lot of staff to a major competitor who offered a better rate of pay.

    Which THREE of the following statements are correct?

    A. The Southern Division's financial performance is acceptable.

    B. The numbers for the measures that have been classified as red and green are not necessarily indicative of overall performance.

    C. The Southern Division's managers should be asked to provide a commentary on the scorecard.

    D. The Southern Division's managers should be reprimanded for having only a small proportion of green classifications.

    E. The Southern Division's managers should be reprimanded for having red classifications.

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