CIMAPRO19-P02-1 Exam Dumps

A manufacturing company sells a large range of products. Forecast data for the next period for one of these products are as follows.

After manufacture, each complete batch must be stored in a local warehouse until it is subsequently sent to the company's main national warehouse. The company does not own a local warehouse. A local warehouse with a maximum capacity of 500 units could be rented for $2,450 for the next period.

Alternatively a larger local warehouse with a maximum capacity of 700 units could be rented for $3,430 for the next period.The company will not begin the manufacture of any new batch until the previous batch has been sent to its main national warehouse.

What would be the change in the total cost of set up and storage if the batch size was changed to 600 units?

Give your answer to the nearest whole $.

Show Answer Hide Answer

$30.328 million is to be invested in a project that will yield annual net cash inflows of $8 million for 5 years.

What is the project's internal rate of return (IRR)?

Give your answer to the nearest whole percentage.

Show Answer Hide Answer

Oliver owns a computer repair company. He is looking to close of of his departments as the demand for computer cleaning has dropped dramatically in the last 2 years and is no longer profitable.

The contribution margin of the department is 12,000, and the overheads are 23,000 (out of which 4,000 cannot be eliminated).

How would closing this department impact operating income?

Show Answer Hide Answer

TTR Ltd plans to purchase a new plant for $1,000m on the 1st of January 20X6. The annual sales expected from the production of this plant is S400m per year. The plant has an expected life of five years. The financial accountant has computed the NPV of the project at $61.42m considering a discount rate of 10%. The marketing director wants to know the percentage drop in revenue that the sales team can afford before the project becomes unviable. Which of the following indicates the percentage required by the marketing

director?

Show Answer Hide Answer

A division of a company transfers all its output to other divisions in the same company.

For this division, which of the following measures is NOT affected by the transfer price that the division uses?

Show Answer Hide Answer