Important CIMAPRA17-BA2-1 Exam Questions

The following data are available for a company that produces and sells a single product.

The company's opening finished goods inventory was 2,500 units.

The fixed overhead absorption rate is $8.00 per unit.

The profit calculated using marginal costing is $16,000.

The profit calculated using absorption costing and valuing its inventory at standard cost is $22,400.

The company's closing finished goods inventory is:

Which of the following cannot be used to split costs into fixed and variable elements?

The correlation coefficient is calculated using which of the following values;

Refer to the exhibit.

Xell Ltd uses a standard costing system and therefore values all inventory at standard cost. During period 3 the price paid for material 'A' was 6 per kg less than the standard price.

The following information for material 'A' relates to period 3:

What was the material price variance for period 3?

The company Andrew works for currently uses traditional absorption costing. He needs to convince his manager that the company should be using activity based costing instead.

Andrew has compiled this list of advantages:

(1)ABC will allow us to make better pricing decisions

(2)ABC will give us tighter control over costs as we will be able to pinpoint inefficiencies

(3)ABC will help improve our product mix by highlighting the best combination of materials

(4)ABC is suitable for our business as we only produce one product

Which statement or statements are INCORRECT?