Cima dumpspedia pearson P1 New Attempt by Andrew q180 vce pdf

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Exam Name:	Management Accounting
Exam Code:	P1 Dumps
Vendor:	CIMA	Certification:	CIMA Operational
Questions:	260 Q&A's	Shared By:	andrew

Question 20

A project has five possible outcomes as follows:

Questions 20

The probability of a contribution of $68,000 is equal to the probability of a contribution of $75,000. Fixed costs are $70,000.

What is the probability of the project making a profit?

Options:

Discussion

Question 21

Company X is deciding which of Projects A, B or C to undertake. The profit earned from each of the projects is dependent on economic conditions.

The table below details the profit for each of the possible outcomes and the expected value of each of the projects.

Questions 21

What is the maximum amount that should be paid for perfect information about the economic conditions?

Options:

$442.50

$497

$54.50

$57.50

Discussion

Andrew

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Question 22

A decision maker that makes decisions using the minimax regret criterion would be classified as:

Options:

Risk averse

Risk seeking

Risk neutral

Risk spreading

Discussion

Question 23

Which of the following, regarding costing methods, is true?

Options:

A company produces two products which undergo similar processes. The company has very low overhead costs. This company should consider activity based costing rather than traditional absorption costing to ensure that its pricing decisions are more accurate.

A company which has introduced technology to reduce labour costs now incurs a greater proportion of non volume-related support activities. Activity based costing would be more appropriate than traditional absorption costing in this environment.

A company is making short term decisions based on the contribution per unit of its different products. These decisions are based upon full absorption costing data.

In traditional absorption costing, overheads are charged to a product by absorbing them at the cost driver rate for an activity based on their usage of the activity.

Discussion

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