F2

Management Accounting

REVIEW OF PAST EXAMS

WHAT WASNT DONE WELL?

F2 problems
Lack of knowledge Careless reading Lack of understanding
Narrative questions generally

Failure to practise questions

LESSONS LEARNED

WHAT TO FOCUS ON?

LIST OF POINTS

Cover the full syllabus Understanding MCQ technique Objective testing question practise

FOCUS ON FUTURE EXAMS

WHATS NEW?

The exam structure

50 x 2 mark objective testing questions CBE will continue to use a mixture of MCQ, NE, MR, MRM questions Paper based exam will continue to use MCQ only

WHATS NEW?

What has gone ?

Short term decision making Dealing with uncertainty Apply methods of relating non production costs to cost units

Whats new ?

Performance measurement Expanded budgeting section Management information Alternative costing principles

Performance Measurement

E1 Overview E2 Application E3 Cost reduction and value enhancement E4 Monitoring and reporting

Typical MCQ
A division has a capital employed of $2,000,000 and earns an operating profi t of $600,000. It is considering a project that will increase operating profit by $20,000 but would increase its capital employed by $80,000. A rate of 15% is used to compute interest on capital employed. What will be the effect on residual income and return on capital employed if the division accepts the project? Residual income investment A B C D Increase Increase Decrease Decrease Increase Decrease Increase Decrease Return on

Budgeting

D2 Statistical techniques D5 Capital budgeting D7 Behavioural aspects of budgeting

Typical MCQ
Two years ago the price index appropriate to the cost of material X had a value of 120. It now has a value of 160. If material X costs $2,000 per kg today, what would its cost per kg have been two years ago? A $1,500 B $1,667 C $2,667 D $3,200

Typical MCQ
The following statements relate to the participation of junior management in the budget setting process: (i) It speeds up the budget setting process. (ii) It increases their commitment to budgets (iii) It incorporates their knowledge into budgets. (iv) It improves their morale and motivation. Which of the statements are true? A (i), (ii) and (iii) B (i), (ii) and (iv) C (ii), (iii) and (iv) D (ii) and (iii) only

Management information

Sources of data Presenting information

Typical MCQ
A publishing company is researching the reading habits of the United Kingdoms population. It randomly selects a number of locations from around the United Kingdom and then interviews everyone who lives in these locations. What is this approach to sampling known as? A Systematic sampling B Stratified sampling C Quota sampling D Cluster sampling

Alternative costing principles

Activity based costing Target costing Life cycle costing TQM

Typical MCQ
Which of the following are benefits of using activity based costing? (1) It recognises that overhead costs are not always driven by the volume of production. (2) It does not result in under or over absorption of fixed overheads. (3) It avoids all arbitrary cost apportionments. (4) It is particularly useful in single product businesses. A 1 only B 1 and 2 only C 2 and 3 only D 1 and 4 only

WILL THINGS CHANGE?

Future changes to exam format

Section A: 35 x2 mark questions Section B: 3 x 10 mark longer form questions Section B testing syllabus areas C D & E