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Question Revision Mock Exam

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Question Revision Mock Exam

  • This topic has 1 reply, 2 voices, and was last updated 7 years ago by John Moffat.
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  • Author
    Posts
  • November 18, 2015 at 4:14 pm #283650
    gabbi08
    Member
    • Topics: 135
    • Replies: 181
    • ☆☆☆

    Dear Mr Moffat

    I have two questions which answer provided are not fully clear to me. Could you please help?

    Question 1:

    There are two statement about performance management:

    a) They should be measure in financial terms
    b) They should be measure factors over which the relevant manager has control

    Which of the statement is true

    Both statement
    Neither statement
    Statement 2
    Statement 1

    My answer was “Both statement” as I have included in the Performance management the RI and ROI however the correct asnwer is Statement 2. Could yo please help?

    Question 2

    The following statements have been made in relation to the concept of throughput accounting:

    Inventory level should be kept at minimun
    All machine within the factory should be 100% efficient no idle time

    Which of the above statement is correct

    My answer was neither I or II for below reason.

    JIT is one of the main concept of the throughput accounting

    the asnwer provided in the test is only I.

    Could you please help

    Thanks and Regards

    Gabriella

    November 18, 2015 at 6:31 pm #283670
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 51551
    • ☆☆☆☆☆

    Question 1:

    RI and ROI are only relevant for divisional performance.

    For performance management in general, managers should be measured on all sorts of factors – not just financial factors. For example, suppose you were a manager of a teaching company. You should be measured on how good your pass rates are (as well as other thing). This is not a financial measure.

    Question 2:

    Because throughput accounting assumes that the only truly variable cost is materials, it automatically assumes that we are keeping very low inventories. It is because we assume in throughput accounting that the materials purchases go up and down with the sales. If we were keeping inventories then this would not be the case.

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