CIMA CIMAPRO19-P01-1 Exam Questions Instant Access

Question 1

Company NBO is providing a quote to manufacture 500 passenger seats for a bus company.

Relevant cost is being used as the basis for the quote.

Which THREE of the following should be included as relevant costs or savings in the production of the 500 passenger seats?

AEquipment depreciation of $2,000 for the time the passenger seats are in production.

BElectricity charges of $1,500 for the completion of the order.

CAdministration overheads of $3,200 apportioned on the basis of labour hours in production.

DSeat cover material, to be bought for $6,000, which cannot be used on other products.

EIdle time pay of $1,000 which would be paid to workers if the quote is not accepted

F$750 paid for a consultant's advice on quoting for the order.

Answer : B, D, E

Question 2

The standard production cost of making a product is as follows:

What is the fixed production overhead efficiency variance?

Give your answer as a whole number.

See Below Explanation:

Answer : A

Question 3

MBB is considering the costs to be incurred in respect of a special order.

The order would require 625 kg of Material K.

This is a material that is readily available and regularly used by the organization in its other products.

There are 265 kg of Material K in inventory which cost $1,590 when it was purchased.

The current market price is $6.48 per kg.

Material K is normally used to make Product X. Each unit of Material X requires 3 kg of Material K, and if Material K is costed at $6 per kg, each unit of Product X yields a contribution of $30.

The relevant cost of Material K to be included in the costing of the special order is:

A$3,990

B$4,050

C$3,923

D$6,250

Answer : B

Question 4

When classifying quality costs, which of the following is NOT likely to be an appraisal cost?

ACost of product liability insurance

BCost of supervision of testing and inspection activities

CPerformance testing costs

DCost of maintaining inspection equipment

Answer : A

Question 5

A company manufactures a single product. The following budgeted data applies to month 6:

What was the budgeted fixed production overhead for month 6?

Give your answer to the nearest whole $ (in '000s).

See Below Explanation:

Answer : A

Question 6

The maximum availability of a material is 8,000 kg.

Product A requires 5 kg of this material and Product B requires 7 kg of this material which is in short supply.

The correct constraint to include for the material when formulating the linear programming problem is:

A5B + 7A 8,000

B5A + 7B 8,000

C5A + 7B = 8,000

D5B + 7A 8,000

Answer : B

Question 7

A company produces a product that requires two materials, Material A and Material B. Details of the material quantities and costs for August are given in the table below.

Budgeted and actual output of the product for August was 12,000 units.

The material mix variance for August is:

A$ 1, 540 Favourable

B$ 1, 540 Adverse

C$ 1, 288 Favourable

D$ 1, 540 Adverse

Answer : A

References:

CIMA P1 Management Accounting CIMAPRO19-P01-1 Exam Questions