CIMA cimapra19-e01-1 practice test
E1 Managing Finance in a Digital World Exam
Question 1
AcrossThePond is a ferry company that has just slashed their prices for trips scheduled to Europe
between August and November - they are now almost half as cheap!
Why would AcrossThePond do this?
Select ALL that apply.
-
A. So that they can increase demand to match supply.
-
B. So that they can fully utilise their production capacity.
-
C. So that they can increase consumer awareness of their summer services.
-
D. So that they can can better manage their supply.
-
E. To increase their revenues.
Answer:
A, B
Question 2
A new manufacturing firm has been growing very rapidly. Both its output and hired staff have
increased dramatically, and it's looking like the business will have to physically expand sometime in
the near future.
The company's managing director decides to outsource the payroll of the business to an external
provider.
What are his likely reasons for making this decision?
-
A. He is finding it difficult to keep on top of all of the support activities he has to provide.
-
B. He is finding managing the payroll complicated and time consuming.
-
C. Payroll requires an expertise on tax and legislation that he does not have in house.
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D. It will allow him to focus on other priorities.
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E. There is more confidentiality when using external providers.
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F. Better management information will be supplied.
-
G. It will improve the accuracy in the payroll.
Answer:
A, B, C, D
Question 3
Company Y is a new business that prides itself on being green and ethical. It uses renewable energy
to run its factories, abides by all the rules and regulations and regularly donates money to
sustainable development charities around the world, despite occasionally being unable to fully pay
its workers.
Why is Company Y in violation of Carroll's CSR pyramid?
-
A. Because it is not profitable.
-
B. Because it should be donating to charities based in their own country.
-
C. Because using renewable energy to run factories generally isn't advised as it can be unreliable.
-
D. Because it is breaking the law by using renewable energy only to run its factories.
-
E. It is not in violation of Carroll's pyramid.
Answer:
A
Question 4
A few years have passed since tech company NVision launched their new games console, Superbox.
The product was once a star, with high, rising sales, but it is now selling quite poorly. In fact, it's
selling
so
poorly
that
NVision are no longer making a return on the product.
Which of the following strategies would be the BEST for NVision to implement?
-
A. Pull out of the market or, if possible, sell the rights of Superbox to an individual or company who is willing to carry it on.
-
B. Keep costs low and continue to sell the console.
-
C. Develop the product for a specific market segment who continue to have a need for it - this will allow NVision to sell the product at a higher price.
-
D. Allow the product to follow its natural life-cycle.
Answer:
A
Question 5
Which of the following are types of primary research? Select ALL that apply.
-
A. Interviews
-
B. Questionnaires
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C. Observation
-
D. Test marketing
-
E. Trade associations/professional bodies
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F. National and local press
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G. Industry magazines
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H. Governments
-
I. Websites
-
J. Informal contacts K. Published company accounts L. Books M. Market surveys produced by external researchers N. Previously gathered marketing research O. Censuses P. Public records
Answer:
A, B, C, D
Question 6
Stephanie has just secured a job as a management accountant for a well-known banking firm. She
needs to understand the organisation's financial position.
What should she do first in order to gain this understanding?
-
A. Record the organisation's transactions in the books of prime entry.
-
B. Inform the tax authorities of the organisation's revenues.
-
C. Total all the day books and enter them into ledgers.
-
D. Submit the company's accounts to the IFRS.
Answer:
A
Question 7
Bright Idea Co. specialises in manufacturing light bulb filaments. It is considering outsourcing some
of it activities in order to reduce costs and improve customer service.
Which of the following is an example of asset specificity that is likely to be an important
consideration in their decision?
-
A. An R&D manager who has been in the business for 18 years and has specialist knowledge of the formulations.
-
B. A building that has been designed specifically for manufacturing light bulb filaments.
-
C. High tech and expensive filling machines in the factory.
-
D. A sales director who is well known and popular throughout the industry.
Answer:
A
Question 8
La Vie En Rose was the latest perfume from the popular and well known perfumery, Lol
a. In almost every high quality magazine there was an advert featuring a famous actress and
produced
by
a
well
known
director.
A
few weeks after launching, La Vie En Rose became the top selling perfume.
At the same time, another perfume called Amber launched from a smaller company and only
appeared in a few advertisements and the perfume doesn't sell well.
In a blind test, where participants tried both Amber and La Vie En Rose, it was found that La Vie En
Rose was the most popular choice.
Which orientation did La Vie En Rose use and why was it more successful than the Amber perfume?
-
A. La Vie En Rose focused primarily on the selling and promotion of a product.
-
B. The perfumery based their marketing around customer needs.
-
C. The perfumery were chiefly concerned with the quality of La Vie En Rose.
-
D. They specialised in producing as much as possible of a given product or service.
Answer:
A
Question 9
The following statements are from which section of the UK Combined Code?
1:The board should disclose a balanced and understandable assessment of the company's position
and prospects in the financial reports.
2:The board should maintain an appropriate relationship with the company's external auditor.
-
A. Accountability
-
B. Leadership
-
C. Effectiveness
-
D. Remuneration
-
E. Shareholder relations
Answer:
A
Question 10
Tom owns a guitar shop, called Jones's Guitars. In attempt to drum up business, he's decided to
launch a guerilla marketing campaign.
Which of the following is the correct example of Tom using guerilla marketing?
-
A. Placing an empty guitar rack outside his shop with a sign saying, "Free air guitar - one per person."
-
B. Encouraging customers to try one of the store's brand new guitars.
-
C. Launching a social media campaign called #GetDownTo]ones's
-
D. Encouraging all his staff to try to build a rapport with the customers.
-
E. Spending a lot of money on decorating the shop and playing the most famous guitar-based songs.
Answer:
A