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P1 Exam Dumps - CIMA Operational Questions and Answers

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Questions 4

Which of the following statements regarding marginal and absorption costing are true in the context of pricing decisions?

Select ALL that apply.

Options:

A.

Marginal costing is appropriate for long-term pricing decisions.

B.

Marginal costing is appropriate for short-term pricing decisions.

C.

Absorption costing when used for pricing decisions includes the 'total-cost' of the product.

D.

Marginal costing ensures the recovery of all costs incurred in selling prices.

E.

Marginal costing is more appropriate for use in one-off pricing decisions.

F.

Absorption costing is more appropriate for use in one-off pricing decisions.

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Questions 5

Which of the following statements about total quality management are incorrect? Select ALL that apply.

Options:

A.

The culture of an organisation should be to get things right the first time.

B.

Everyone within an organisation should be involved in improving quality.

C.

All costs relating to quality should be examined, particularly those relating to failure costs.

D.

There is an acceptable quality level that an organisation must try to achieve.

E.

The costs of conformance are more important than the costs of non-conformance.

F.

The organisation should rely on inspection to achieve quality standards.

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Questions 6

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

Options:

A.

Cost of product liability insurance

B.

Cost of supervision of testing and inspection activities

C.

Performance testing costs

D.

Cost of maintaining inspection equipment

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Questions 7

JDM is considering whether to go ahead with the launch of a new product. Profit from the new product is dependent on the level of demand.

The following table shows the estimated profits and their respective probabilities at different levels of demand.

The company could still cancel the launch of the product but would incur a cost of $7,000.

What is the maximum amount that the company should pay for perfect information about demand for the product?

Options:

A.

$13,350

B.

$41,000

C.

$16,500

D.

$37,850

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Exam Code: P1
Exam Name: Management Accounting
Last Update: Jan 26, 2023
Questions: 180
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