Online Access Free CIMAPRO19-P01-1 Exam Questions

Place each activity against the correct category according to its classification in the cost hierarchy of activities.

Correct Answer:

XY manufactures a range of products and uses an activity based costing system.
Budgeted production of Product B is 7,500 units.
Overheads have been identified by activity and related to appropriate cost drivers.
Product B is produced in batches of 250 units. Machines have to be reset after every batch and quality inspections are carried out on every third batch.

What is the total overhead cost per unit of Product B?
Give your answer to two decimal places.

Explain THREE benefits that organizations gain from using budgetary planning and control systems.
Select ALL the true statements.

• A.It provides a standard which managers may be motivated to achieve. It can also encourage inefficiency and conflict between managers particularly if the budget is imposed from above, whereby it may act as a threat rather than as a challenge.
• B.The budget ensures actions of different parts of the organization are coordinated are reconciled otherwise managers take actions for the benefit of their own part of organization that may not benefit the organization as a whole.
• C.The budget provides an external benchmark against which performance against which performance can be evaluated.
• D.Budgeting forces an organization's management to look ahead and set performance targets.
• E.The budget acts as a variable mechanism, with actual results being compared with budget.
• F.Another benefit of budgeting is to set targets to motivate managers and optimize their performance.
• G.The budget is a useful device of influencing an operator's thoughts and motivating operators to perform in line with the organization's marketing budget.

An agricultural company uses activity based costing to charge overheads to its three products. One of the main activities is purchasing, budgeted details of which are as follows:
Additional budgeted data:

What is the budgeted purchasing overhead cost per kg of Product S?
Give your answer to 2 decimal places.

In a manufacturing company, breakeven occurs at which TWO of the following?

• A.When revenue is equal to contribution
• B.When fixed costs are equal to contribution
• C.When revenue is equal to fixed costs
• D.When profit is equal to zero
• E.When contribution is equal to zero