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P2 Exam Dumps : Advanced Management Accounting

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Advanced Management Accounting Questions and Answers

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Question 1

Which TWO of the following statements are correct?

Options:

A.

It is worthwhile for a company to sell further units when the marginal revenue is greater than the marginal cost.

B.

Price is the only factor affecting the demand for products and services.

C.

Premium pricing is possible when there is a measure of product or service differentiation.

D.

Loss leadership pricing is appropriate for a new product which is not part of a range of products.

E.

Demand functions can be predicted accurately and the relationship between price and quantity demanded is always constant.

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Question 2

A long established organization has recognised the need to make urgent changes to the way it operates in order to remain competitive. The organization wishes to dramatically improve its performance through a fundamental rethinking and radical redesign of its existing activities.

Which of the following techniques should be used to achieve this?

Options:

A.

Functional analysis

B.

Kaizen costing

C.

Business process re-engineering

D.

Process innovation

Question 3

Which of the following statements is correct in respect of the key feature of dual pricing?

Options:

A.

The selling price recorded by the selling division is higher than the cost recorded by the receiving division.

B.

Internal customers are offered trade discounts depending on the number of units they purchase.

C.

Internal transfers are priced at marginal cost and a lump sum payment is made subsequently to contribute to fixed costs.

D.

Internal customers are charged a lower price than external customers to reflect savings in distribution costs.

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