Pass the CIMA Management P2 Questions and answers with ExamsMirror

Which TWO of the following conditions are necessary for a learning curve to apply?

SQ has the opportunity to invest in project X. The net present value for project X is $12,600. Cash inflows occur in years 1, 2 and 3. The company's cost of capital is 14%.

Calculate the annualized equivalent annuity of project X.

Give your answer to the nearest whole $.

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Place each of the activities described below against the correct classification of quality costs.

SkillWeave are an international clothing manufacturer known for their durable and high quality products. Recently their biggest market in the world's premier customs union has had some economic volatility. This has

resulted in the currency of this market being very unstable and difficult to predict in terms of whether it will retain, lose or gain relative value to domestic currency.

Which of the following is an effective risk reduction technique for SkillWeave's clothing sales to this region?

Which of the following statements is NOT correct?

Transfer prices between responsibility centers should be set at a level that:

The starting point for developing a balanced scorecard for an organization should be:

The money cost of capital is 12%. The expected rate of inflation is 4%. What is the real cost of capital?

Give your answer to 2 decimal places.

A company's competitor has just launched a rival product at a selling price of $38 per unit. Until now the company's selling price of $41.60 per unit has achieved a 30% mark-up on the product's unit cost. The company proposes to use a target costing approach to pricing to remain competitive.

Management has decided to match the competitor's selling price and has set a target cost to achieve a 20% return on the target price.

What is the cost gap?

Which of the following statements are fundamental concepts that underlie the Beyond Budgeting approach?

1. Use traditional budgeting in conjunction with other techniques.

2. Use adaptive management processes rather than the more rigid annual budget.

3. Move towards devolved networks rather than centralized hierarchies.

4. Move towards centralized hierarchies rather than devolved networks.

Juan is looking to invest in the mining industry. He has narrowed his options down to two rival companies, both with sales of £200m. Company A has an EBIT of £10m whereas Company B has an EBIT of £14m.

This would suggest that Company B is the better investment but Juan is suspicious that Company B has more financial backing than Company A.

Which ratios will tell him which company will use his investment the best?