Acowtancy

Question 1

Rolling budgets and flexible budgets are a way of trying to reduce the element of uncertainty in the plan.

Answer 1

true

Question 2

Which of the 4 levels in the Big Data Pyramid refers to giving insights into the information?

Data
Information
Knowledge
Wisdom

Answer 2

Wisdom

Question 3

One of the best ways to reduce cost is to bring together members of the marketing, design, assembly and distribution teams to allow discussion of methods to reduce costs.

true
false

Answer 3

true

Question 4

Service Organisation faces following problems when implementing Target Costing except

+ Very difficult to determine a market-driven price
+ Very difficult to determine margin of profit
+ Introduction of new services occurs far less frequently than in a manufacturing company
+ very difficult to reduce the cost of salaries

Answer 4

Very difficult to determine a market-driven price

Question 5

Which of the 4 levels in the Big Data Pyramid refers to helping make decisions in the future?

Data
Information
Knowledge
Wisdom

Answer 5

Wisdom

Question 6

If buying price is more than the variable costs of making, the right decision is to make.

true
false

Answer 6

true

Question 7

In simulation, models are not complex and are easy to formulate.

false
true

Answer 7

false

Question 8

Shut down decisions may result to loss of contribution from the segment and savings in specific fixed costs from closure.

true
false

Answer 8

true

Question 9

The following are considered in deriving a Target Cost,except;

Specifying a product
The price at which it could be sold
The method of costing the product
Doing market research and competitor’s analysis.

Answer 9

The method of costing the product

Question 10

Shorter product life cycles in the modern business environment mean that standard costs will need to be reviewed and updated frequently.

true
false

Answer 10

true

Question 11

Which of the following would explain a labour efficiency planning variance?

(1) A change in employment legislation requiring staff to take longer rest periods

(2) Customers demanding higher quality products leading to a change in product design

(3) The learning effect for labour being estimated incorrectly in the production budget

1 and 2 only
2 and 3 only
3 only
1, 2 and 3

Answer 11

1, 2 and 3

Explanation
Labour efficiency planning variance will occur when the standard hours have to be revised due to factors which are beyond the control of the operational managers.

All the factors would require the original standard hours to be revised and would therefore cause a labour efficiency planning variance.

Therefore statements (1), (2) and (3) are all correct.