FM015: PART A SET 1

1. Which of the following statements relating to management information are true?

• 1 and 2
• 1 and 3
• 2 and 4
• 3 and 4

2. A total cost is described as staying the same over a certain activity range and then increasing but remaining stable over a revised activity range in the short term. What type of cost is this?

• Fixed cost
• Variable cost
• Semi-variable cost
• Stepped fixed cost

3. The manager of a profit centre is responsible for which of the following?

• 1 only
• 2 only
• 1 and 2
• All the above

4. A local weekly newspaper sells about half a million copies a week in a region of about 100 square miles. It is decided that the sample will represent the various age groups, income groups, men and women, and people from different areas of the region in proportion to their numbers in the population in the region. Which type of the following samples is constructed in this manner?

• Simple random
• Systematic
• Stratified random
• Cluster

5. Which of the following is an example of external information that could be used in a management accounting system?

• Consumer price index statistics
• Price list for the products sold by the business
• Production volume achieved by the production department
• Discounts given to customers

6. There is to be an increase next year in the rent from $12,000 to $14,000 for a warehouse used to store finished goods ready for sale. What will be the impact of this increase on the value of inventory manufactured and held in the warehouse?

• An increase of $14,000
• A decrease of $14,000
• An increase of $2,000
• No change

7. The sales manager has prepared a manpower plan to ensure that sales quotas for the forthcoming year are achieved. This is an example of what type of planning?

• Operational planning
• Tactical planning
• Strategic planning
• Corporate planning

8. Which TWO of the following should be classified as indirect labour?

• Assembly workers on a car production line
• Forklift truck drivers in the stores of an engineering company
• Floor cleaners in a factory producing clothes
• Bricklayers in a house building company

9. Which of the following is not a cost objects?

• A cost centre
• A manager
• A customer
• A product

10. Which of the following statements referring to spreadsheets are correct?

• A spreadsheet is the most suitable software for the storage of large volume of data
• A spreadsheet could be used to produce a flexible budget
• They are an efficient method of storing text-based files
• Most spreadsheets contain a facility to display the data within them in a graphical form