P2 Advanced Management Accounting Exam Questions in PDF and Online

QUESTION: 6

SDF is a newly-established production company that is experiencing high staff turnover in its factory. The production department is studying the manufacturing process and its associated learning curve.

Which of the following statements is correct?

SDF's staff turnover will disrupt the observation and measurement of the learning curve.
SDF's staff turnover will affect the learning curve.
SDF's rapid staff turnover means that knowledge of the learning curve has little value.
SDF can use the learning curve to determine labor budgets for the remainder of the first year of operation.

Answer(s): A

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QUESTION: 7

Product WB currently sells for $13 per unit. Annual demand at that price is 20,000 units. If the price increases to $15, the annual demand falls by 500 units.

What is the formula for the demand curve?

Q = a - bP
P = f(Q).
Qd = a b(P
P = a -b(Q)

Answer(s): C

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QUESTION: 8

The management of a leisure company, who are risk averse, have just approved an investment in a new amusement park. The country in which the amusement park will be located has a warm and mostly dry climate throughout the year.

A number of specific risks related to this investment have been identified as follows.

(1) Losses of very small amounts of revenue due to poor weather.

(2) A significant financial liability may arise due to the injury of a member of the public.

(3) Loss of several days of revenue due to rides being unavailable because of poor maintenance routines.

(4) Income fraud as a consequence of the high levels of cash handled by employees.

Using the TARA framework, which is the most appropriate way of managing each of these risks?

Transfer risk 1; accept risk 2; avoid risk 3; reduce risk 4
Accept risk 1; avoid risk 2; transfer risk 3; reduce risk 4
Accept risk 1; transfer risk 2; avoid risk 3; reduce risk 4
Reduce risk 1; transfer risk 2; avoid risk 3; accept risk 4

Answer(s): C

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QUESTION: 9

CORRECT TEXT
$30.328 million is to be invested in a project that will yield annual net cash inflows of $8 million for 5 years.

What is the project's internal rate of return (IRR)?
Give your answer to the nearest whole percentage.

9 %, 10 %, 11 %

Answer(s): A

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QUESTION: 10

An organization has a decentralized structure in which division A supplies division B with an intermediate product for which there is no external market. Division B carries out further processing and then sells the final product on the external market. Due to organizational policy the current transfer pricing basis is variable cost.

The manager of division A has stated, "The current transfer price is unfair because it does not enable us to recoup our costs".

The manager of division B has stated, "The current transfer pricing system enables us to quote competitive prices for the finished product".

The Chief Executive of the organization is considering imposing a transfer pricing policy that uses dual pricing.

Dual pricing would:

be welcomed by the manager of division A but the manager of division B would resist it.
be welcomed by both divisional managers.
increase divisional autonomy.
involve a lump sum payment to division A in addition to the payment of the variable cost per unit.

Answer(s): B

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CIMA P2 Advanced Management Accounting P2 Advanced Management Accounting Exam Questions in PDF

Free CIMA P2 Advanced Management Accounting Dumps Questions (page: 2)

QUESTION: 6

QUESTION: 7

QUESTION: 8

QUESTION: 9

QUESTION: 10