P1 Self-Study Guide for Becoming an Management Accounting Expert
P1 Study Guide Realistic Verified P1 Dumps
Understanding function and technical aspects of Analyse performance using financial and nonfinancial information
The following will be discussed in CIMA P1 exam dumps:
- Identify information that can enable managers to review performance
- Identify appropriate KPIs for different functions of the organisation
- Explain company performance using KPIs
- Prepare performance reports for use by different functions and for different purposes in appropriate formats and media
- Interpret variances to review functional and organisational performance
NEW QUESTION 143
A small manufacturing company makes a single product. Direct labour costs and factory rent account for
80% and 15% of total cost respectively. Activity levels have not varied by more than 5% for a number of years and there is no evidence of operational inefficiency.
Which of the following is the most appropriate approach to budgeting for this company?
- A. Activity based budgeting (ABB)
- B. Zero based budgeting (ZBB)
- C. Rolling budgeting
- D. Incremental budgeting
Answer: D
NEW QUESTION 144
A completed unit of Product A requires 9 kg of material and 10% of material is wasted in the production process.
Material has a standard cost of $5 per kg.
Product A also requires 4 labour hours at a standard cost of $10 per labour hour and variable overheads at a standard cost of $2 per labour hour What is the standard variable production cost per unit of Product A?
- A. $50
- B. $93
- C. $97.50
- D. $98
Answer: D
NEW QUESTION 145
XY, a not-for-profit charity organization which is funded by public donations, is concerned that it is not making the best use of its available funds. It has carried out a review of its budgeting system and is considering replacing the current system with a zero-based budgeting system.
Select ALL the potential advantages AND disadvantages for the charity of a zero-based budgeting system.
- A. Preparation of the decision packages will normally require the environment of many employees. This environment may produce useful ideas and promote job satisfaction.
- B. The creation of decision packages and their subsequent ranking by top management is very time consuming and costly. The charity will need to assess whether the benefits of the system outweigh the costs involved.
- C. It discourages a questioning approach by focusing attention not only on the cost of the activity but on the benefits it provides. The charity managers will not articulate the benefits encouraging them to think clearly about the activities.
- D. It avoids the complacency inherent in the traditional incremental approach where it is assumed that future activities will be very similar to current ones.
- E. In an organization like a charity, the decision packages are not very disparate and difficult t compare.
- F. In applying traditional budgeting, 'activities' may result in functional departments rather than cross functional activities and thus distract attention from the real cost-reduction issues.
Answer: A,B,D
NEW QUESTION 146
LM operates a parcel delivery service. Last year its employees delivered 15,120 parcels and travelled
120,960 kilometers. Total costs were $194,400.
LM has estimated that 70% of its total costs are variable with activity and that 60% of these costs vary with the number of parcels and the remainder vary with the distance travelled.
LM is preparing its budget for the forthcoming year using an incremental budgeting approach and has produced the following estimates:
* All costs will be 3% higher than the previous year due to inflation
* Efficiency will remain unchanged
* A total of 18,360 parcels will be delivered and 128,800 kilometers will be travelled.
Calculate the following costs to be included in the forthcoming year's budget:
(i) the total variable costs related to the number of parcels delivered.
(ii) the total variable costs related to the distance travelled.
- A. Parcel related cost for next year = $112,308; Distance related costs for next year = $79,590
- B. Parcel related cost for next year = $115,306; Distance related costs for next year = $31,590
- C. Parcel related cost for next year = $112,118; Distance related costs for next year = $59,699
- D. Parcel related cost for next year = $109,118; Distance related costs for next year = $89,699
- E. Parcel related cost for next year = $105,306; Distance related costs for next year = $30,590
Answer: C
NEW QUESTION 147
Company Y absorbs fixed production overheads using a rate per machine hour. Budgeted and actual data for month 8 are as follows:
What is the fixed production overhead efficiency variance?
- A. $400,000 favourable
- B. $1,000,000 adverse
- C. $1,000,000 favourable
- D. $400,000 adverse
Answer: A
NEW QUESTION 148
A special contract requires 640 units of component T.
The inventory of 280 units of component T cost $0.20 per unit but the component is not currently used by the company.
The current market price of component T is $0.24 per unit but the inventory could be sold for $0.15 per unit.
The relevant cost of the units of component T required for the special contract is:
- A. $100.40
- B. $128.40
- C. $153.60
- D. $142.40
Answer: B
NEW QUESTION 149
The cost card for one unit of Product G is as follows:
The opening and closing inventories of Product G for month 5 are budgeted to be 10 units and 60 units respectively.
Profit for month 5 using absorption costing is budgeted to be $15,000.
What is the budgeted profit for month 5 using throughput costing?
- A. $12,800
- B. $17,200
- C. $9,800
- D. $20,200
Answer: C
NEW QUESTION 150
The breakeven point in units, in a multiple product context, is calculated using which of the following formulae?
- A. Fixed costs / weighted average contribution per unit
- B. Fixed costs / weighted average contribution to sales ratio
- C. Fixed costs / weighted average revenue per unit
- D. Fixed costs / weighted average profit per unit
Answer: A
NEW QUESTION 151
A company has only 10,100 hours of skilled labour available next period.
Data for its three products for next period are as follows.
At least 500 units of each product must be sold each period.
No inventories are held.
How many units of Product X should be manufactured next period in order to maximise profit?
Answer:
Explanation:
1200 units
NEW QUESTION 152
The fixed production overhead volume variance is:
- A. $3,500 A
- B. $10,500 F
- C. $7,000 A
- D. $10,500 A
Answer: D
NEW QUESTION 153
Petco's material price standard was £8 per kg.
When looking over their accounts you calculate that in fact they they purchased 2,000kg at £6 per kg due to an overly abundant harvest that lowered global pet food prices.
You have been asked by your manager to analyse these figures and come to a conclusion.
With that in mind which of the following statements are correct? Select ALL that apply.
- A. The material price operational variance is £4,000
- B. Management had no control over this variance
- C. Management had control over this variance
- D. The material price planning variance is £4,000
Answer: B,D
NEW QUESTION 154
Company M is preparing its budgeted profit statement for the next year.
The initial budget for Product A is as follows with some changes proposed by the sales director to increase the quality of the product.
What would the budgeted profit of Product A be if the proposed changes are made?
Give your answer as a whole number.
Answer:
Explanation:
$129500
NEW QUESTION 155
FGH used to manufacture components that required raw material Q.
Currently there are 80 kg of material Q in inventory.
The company has no use for the material in the foreseeable future and intends to sell it for scrap.
A potential new customer has asked for a price for a large order.
This order would require 100 kg of material Q.
The company management has decided to quote a price for this work on a relevant cost basis.
Details of costs for material Q are as follows:
What would be the relevant cost of Material Q to use in this order?
- A. $198
- B. $46
- C. $230
- D. $110
Answer: D
NEW QUESTION 156
A company is considering the use of Material V in a special order.
The material is used regularly and a sufficient quantity of the material is in inventory.
It could also be sold, at just below the current market price, to a local competitor.
What is the relevant cost of Material V to be used in the special contract?
- A. The replacement cost of the material.
- B. Nil
- C. The resale value of the material.
- D. The historic cost of the material in inventory.
Answer: A
NEW QUESTION 157
The budgeted production of product G for the period was 300 units. At the end of the period it was discovered that the standard hourly rate for labour should have been higher than that originally planned. Actual production was 450 units.
The labour rate planning variance would be calculated as:
- A. The revised standard cost of 450 units compared with the original standard cost of 450 units
- B. The revised standard cost of 300 units compared with the orginal standard cost of 300 units
- C. The revised standard cost of 300 units compared with the original standard cost of 450 units
- D. The revised standard cost of 450 units compared with the original standard cost of 300 units
Answer: A
NEW QUESTION 158
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Below is the CIMA Operational CIMA P1 Accounting
- Passing score: 70%
- Format: Multiple choices, multiple answers
- Length of Examination: 90 minutes
- Number of questions: 60
- Language: English
Certification Path for CIMA Operational CIMA P1 Accounting
The CIMA Professional Qualification is suited for anybody who wants to pursue a career in finance focusing on accounting, reporting and business strategy. It is quite different than the conventional courses which concentrate more on accounting, taxation and audit.
CBAs are available for all the papers of the Certificate Level and can be taken at any time of the year, allowing students to progress through CIMA papers at their own pace.
CBA uses computers to deliver questions and receive answers. Objective test questions are used in the assessment (the most common type is multiple choice but there are other formats).
The CBA system has many benefits:
- You will receive individual performance feedback after the assessment, if you are unsuccessful this will help you to identify the areas of the syllabus where you require a better understanding of the topics.
- CBA allows for a wide range of the syllabus to be covered so you can be confident that you have a sound grounding in business and accounting in preparation for the Intermediate level exams.
- You will receive your results immediately after you finish the assessment, because the computer can mark it instantly.
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