CIMA P2 Advanced Management Accounting CIMAPRO19-P02-1 Exam Questions

A project requires an initial investment of $160,000 in an asset for which the annual depreciation charge will be $40,000. The forecast profits from the investment are as follows.

What is the payback period for the project in years? Give your answer to two decimal places.

The cash flows from a project are detailed in the table below.

To the nearest 1%, what is the project's internal rate of return?

A cost centre manager's performance is monitored based on a comparison of actual and budgeted cost. A summary performance report for the latest period is shown below.

The actual costs include:

*$28,000 for allocated head office costs.

*$18,000 payment for a rental agreement entered into by the cost centre manager two years ago.

*$34,000 for depreciation.

What is the cost centre manager's controllable actual cost for the period?

Give your answer to the nearest $000.

A company is considering four mutually exclusive projects. There are three possible future demand conditions but the company has no idea of the probability of each of these demand conditions occurring. The forecast net present values (NPVs) of each of the four projects, under each of the three possible future demand conditions, are as follows.

Using the maximax criterion, which investment should be selected?

Which basis of transfer pricing retains the full autonomy of divisional managers?

Company D is about to launch an innovative and unique product which may face direct competition within three years. The company needs to achieve a rapid payback on all investments because it has limited access to external finance.

Which is the most appropriate pricing strategy for company D's new product, and for what reason?

Which of the following factors would prevent a learning curve being observed for a task?