Financial Management Exam February 2024
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Questions and Answers

What is the correct annual depreciation charge for the new computers purchased by Grassroots Ltd given a cost of €75,000, a useful life of 5 years, and a residual value of €5,000?

  • €10,000
  • €15,000
  • €13,000
  • €14,000 (correct)

    • After a year, how would you calculate the carrying amount of total non-current assets for a company that began with €500,000, had a depreciation of €60,000, and acquired new assets costing €40,000?

  • €440,000
  • €480,000
  • €460,000 (correct)
  • €400,000

    • Where should the withdrawal of €20,000 by an entrepreneur for private purposes be classified in the statement of cash flows?

  • The transaction is not recorded on the statement of cash flows.
  • The transaction is recorded as cash flows from financing activities. (correct)
  • The transaction is recorded as cash flows from investing activities.
  • The transaction is recorded as cash flows from operating activities.

    • What does the balance of trade payables represent?

    <p>The amount owed to suppliers for credit purchases.</p> Signup and view all the answers

    How does new asset acquisition of €40,000 during the year impact the total amount of non-current assets?

    <p>It increases the carrying amount of total non-current assets.</p> Signup and view all the answers

    What remains constant in the straight-line depreciation method over the useful life of an asset?

    <p>Annual Depreciation Expense</p> Signup and view all the answers

    What is the effect of withdrawing funds from a business on its equity?

    <p>It decreases total equity by the amount withdrawn.</p> Signup and view all the answers

    What method is typically used to determine the annual depreciation expense for furniture and fittings in a company?

    <p>Straight-Line Method</p> Signup and view all the answers

    Which action could help Dusk Ltd achieve a 10% reduction in operating expenses?

    <p>Reducing rent expenses</p> Signup and view all the answers

    Where is the purchase of inventories on credit recorded in the statement of cash flows?

    <p>Recorded as cash flows from operating activities</p> Signup and view all the answers

    Which statement correctly describes the relationship between net profit and equity?

    <p>Net profit accounts for the movement in equity</p> Signup and view all the answers

    What is the total depreciation for the computer equipment after 7 months of ownership?

    <p>€21,000</p> Signup and view all the answers

    How does reducing the cost of sales affect a company's financials?

    <p>It increases the net profit margin</p> Signup and view all the answers

    What is the impact of capitalizing a purchase of machinery on the balance sheet?

    <p>Increases assets</p> Signup and view all the answers

    Which of the following correctly identifies an asset?

    <p>Trade receivables relating to an amount owed from customers.</p> Signup and view all the answers

    What is the total amount of non-current assets for Rust Ltd?

    <p>€320,000</p> Signup and view all the answers

    How should cost of sales be classified?

    <p>An expense</p> Signup and view all the answers

    What direct effect does an increase of €20,000 in the purchase of inventories have on profit levels?

    <p>Gross profit, EBITDA, EBIT and net profit are affected.</p> Signup and view all the answers

    What will be the value of equity on 31 December 2023 for Reeds Ltd?

    <p>€360,000</p> Signup and view all the answers

    If interest costs decreased by €25,000, what is the effect on profit levels?

    <p>EBITDA, EBIT and net profit increased by €25,000.</p> Signup and view all the answers

    Which option best describes retained earnings?

    <p>A component of shareholders' equity.</p> Signup and view all the answers

    What is the implication of a company's purchase of non-current assets?

    <p>It will affect the cash flow in the long term.</p> Signup and view all the answers

    What is the cost of sales calculated if the beginning inventory is €50,000, purchases during the year are €300,000, and the ending inventory is €60,000?

    <p>€290,000</p> Signup and view all the answers

    Which statement accurately describes a financial statement's function regarding inventories?

    <p>The statement of cash flows shows the total amount of inventories purchased.</p> Signup and view all the answers

    If a company has sales revenue of €200,000, purchases of €110,000, and a gross profit margin of 40%, what is the cost of sales?

    <p>€120,000</p> Signup and view all the answers

    What is the correct definition of gross profit margin?

    <p>Total revenues minus total cost of sales.</p> Signup and view all the answers

    What could be a consequence of overstating inventory levels in financial statements?

    <p>Higher perceived profitability.</p> Signup and view all the answers

    Which of the following is NOT typically included in the statement of cash flows?

    <p>Total revenue reported for the year.</p> Signup and view all the answers

    When calculating cost of sales, which of the following components is NOT considered?

    <p>Sales returns during the period.</p> Signup and view all the answers

    Which statement is true about the relationship between gross profit and expenses?

    <p>Gross profit is calculated before deducting operating expenses.</p> Signup and view all the answers

    How much can Linda save by choosing Supplier 2?

    <p>€7,289.31</p> Signup and view all the answers

    What is the total area of the room where tiles need to be placed?

    <p>27 m²</p> Signup and view all the answers

    Including wastage, how much surface area in m² should be estimated for tiling?

    <p>29.7 m²</p> Signup and view all the answers

    What is the cost per square meter for tiles?

    <p>€45</p> Signup and view all the answers

    What is the estimated total budgetary cost for the tiling project?

    <p>€1,366.20</p> Signup and view all the answers

    How much butter does Emily need for two batches of cookies?

    <p>360g</p> Signup and view all the answers

    How much will Emily spend on sugar for the cookies if she uses the needed amount?

    <p>€4.98</p> Signup and view all the answers

    If Emily buys 2 boxes of eggs costing €4.50 each, what will be the total cost for the eggs?

    <p>€9.00</p> Signup and view all the answers

    How many additional wagons are needed to increase the ride capacity by a minimum of 120 visits per hour?

    <p>2 wagons</p> Signup and view all the answers

    What is the capacity utilization rate for SSC Napoli during the 2022/2023 season?

    <p>84.6%</p> Signup and view all the answers

    Which of the following statements about unintended and intended excess capacity is correct?

    <p>Both statements are correct</p> Signup and view all the answers

    What is the total cost of equipment from Supplier 1 after including import duty and delivery costs?

    <p>$21,300</p> Signup and view all the answers

    Which factor would lead Linda to decide against choosing Supplier 1?

    <p>Higher delivery cost</p> Signup and view all the answers

    How is the import duty calculated for Supplier 2?

    <p>18% only on the equipment cost</p> Signup and view all the answers

    Which of the following best describes the cost advantage Linda would gain by selecting the lowest cost supplier?

    <p>Lower initial investment cost</p> Signup and view all the answers

    Based on the information provided, how many visits does the stadium need to achieve a 100% capacity utilization rate?

    <p>54,726 visits</p> Signup and view all the answers

    Which of these represents an asset?

    <p>Trade receivables relating to an amount owed from customers</p> Signup and view all the answers

    What is the direct effect on profit levels from an increase in the purchase of inventories by €20,000?

    <p>Gross profit, EBITDA, EBIT and net profit are affected</p> Signup and view all the answers

    What will be the value of equity for Reeds Ltd on 31 December 2023?

    <p>€360,000</p> Signup and view all the answers

    What is the effect on profit levels if interest costs decrease by €25,000?

    <p>EBITDA, EBIT and net profit increased by €25,000</p> Signup and view all the answers

    What is the classification of software licenses for Rust Ltd?

    <p>Intangible assets</p> Signup and view all the answers

    What does a bank loan to finance new IT hardware represent in accounting terms?

    <p>A liability</p> Signup and view all the answers

    How should a financing transaction be recorded on the statement of cash flows?

    <p>As cash flows from financing activities</p> Signup and view all the answers

    What is the expected number of visits if the break-even point is 3,000 visits with a margin of safety of 40%?

    <p>4,200 visits</p> Signup and view all the answers

    What cost type is directly connected to the level of business activity?

    <p>A variable cost</p> Signup and view all the answers

    If a company expects 2,000 visitors with a break-even point of 1,400 visitors, what is the margin of safety?

    <p>43%</p> Signup and view all the answers

    Which type of cost structure is considered less risky for a company?

    <p>High proportion of fixed costs</p> Signup and view all the answers

    How many t-shirts must be sold each day to break even, given a sale price of €25 and a cost of sales of €8 with fixed costs of €2,550?

    <p>184 t-shirts</p> Signup and view all the answers

    What additional revenue is required for a company with sales of €300,000, variable costs of €60,000 and fixed costs of €210,000 to increase profit by €2,400?

    <p>€9,000</p> Signup and view all the answers

    An event is expected to have 2,000 visitors with a break-even point at 1,400. If the cost per visitor is €10, what is the total contribution margin if all visitors attend?

    <p>€8,000</p> Signup and view all the answers

    What is the total budget for an advertisement that is clicked 2,000 times, following the specified rates?

    <p>€1,100</p> Signup and view all the answers

    What is the regular ticket cost after including the supplement for both Anne-Sophie and Marie?

    <p>€39</p> Signup and view all the answers

    What gross salary does Sam need to earn as a festival administrator to match his current marketeer salary on an hourly basis?

    <p>€3,578</p> Signup and view all the answers

    What is the tax Kim effectively pays on her €15,000 gift after considering the tax-free amount?

    <p>6.8%</p> Signup and view all the answers

    How much would Marie's discounted ticket cost excluding the supplement?

    <p>€16</p> Signup and view all the answers

    If the festival administrator job offers a lower gross salary than the marketeer role, what is the key factor that contributes to Sam's decision?

    <p>Reduced working hours</p> Signup and view all the answers

    What is the children's discount rate on Marie's ticket if Anne-Sophie's ticket is €21?

    <p>40%</p> Signup and view all the answers

    What is the minimum number of hours Sam needs to work in his new job to earn at least the same amount as in his current job?

    <p>36 hours</p> Signup and view all the answers

    What was the cost of sales in the year if the inventories at the start were €50,000, purchases were €300,000, and inventories at the end were €60,000?

    <p>€290,000</p> Signup and view all the answers

    Which statement correctly identifies the function of the statement of financial position?

    <p>It reflects the assets, liabilities, and equity at a specific point in time.</p> Signup and view all the answers

    If a company has a sales revenue of €200,000 and purchases of €110,000, with a gross profit margin of 40%, what is the cost of sales?

    <p>€160,000</p> Signup and view all the answers

    What can be inferred about the purchases recorded in the statement of cash flows?

    <p>It indicates the cash payments made for inventory purchases.</p> Signup and view all the answers

    Which of the following statements regarding the statement of cash flows is false?

    <p>It shows the profit generated during the accounting period.</p> Signup and view all the answers

    What is a common misconception about inventories as presented in financial statements?

    <p>Inventories sold are reflected in the statement of cash flows.</p> Signup and view all the answers

    Which effect does an increase in inventories have on cash flows during a reporting period?

    <p>It leads to cash outflow for the purchase of inventories.</p> Signup and view all the answers

    What is the implication of a gross profit margin of 40% on sales of €200,000?

    <p>The total profit before expenses is €80,000.</p> Signup and view all the answers

    What is the annual depreciation charge for the computer equipment acquired on 1 June 2023, given a cost of €160,000, a useful life of 4 years, and a residual value of €16,000?

    <p>€136,667</p> Signup and view all the answers

    What amount is recorded as sales revenue in the income statement for Hop Ltd, which made credit sales of €50,000 and cash sales of €10,000?

    <p>€60,000</p> Signup and view all the answers

    Where on the statement of cash flows is the purchase of inventories on credit recorded?

    <p>As cash flows from operating activities.</p> Signup and view all the answers

    What was the value of trade receivables as at 31 December 2023?

    <p>€100,000</p> Signup and view all the answers

    Which statement is correct regarding the net profit in a certain time period?

    <p>Only the net profit accounts for movements in Equity.</p> Signup and view all the answers

    Which of the following correctly identifies a component of total revenue for a company?

    <p>Total sales from both credit and cash transactions</p> Signup and view all the answers

    What was Moon Ltd's gross profit for the year ended 31 December 2023?

    <p>€4,200,000</p> Signup and view all the answers

    What will be the effect on profit levels if the cost of sales increases?

    <p>Profit levels will decrease.</p> Signup and view all the answers

    What is the direct effect on current assets when a company purchases inventories for €5,000 and pays via bank transaction?

    <p>The total amount of current assets stays the same.</p> Signup and view all the answers

    What financial strategy could a company use to improve net profit if sales remain constant?

    <p>Reduce operating costs significantly</p> Signup and view all the answers

    What was the cost of new inventories purchased by Stream Ltd in 2023?

    <p>€78,000</p> Signup and view all the answers

    Where are rent expenses recorded in the income statement?

    <p>Operating expenses</p> Signup and view all the answers

    What amount is repaid in the first year for a loan of €5,000,000 with repayments in a straight line over 10 years?

    <p>€500,000</p> Signup and view all the answers

    If a company had sales revenue of €200,000 and purchases of €110,000, what is the cost of sales if the gross profit margin is 40%?

    <p>€80,000</p> Signup and view all the answers

    What is the total amount of non-current assets for Rust Ltd based on the provided information?

    <p>€180,000</p> Signup and view all the answers

    How should a transaction that involves acquiring long-term investments be recorded on the statement of cash flows?

    <p>As cash flows from investing activities</p> Signup and view all the answers

    If the break-even point is 3,000 visits and the margin of safety is 40%, what is the expected number of visits?

    <p>4,200 visits</p> Signup and view all the answers

    What type of cost varies directly with the level of production or business activity?

    <p>A variable cost</p> Signup and view all the answers

    A company expects 2,000 visitors at its event with a break-even point of 1,400 visitors. What is the margin of safety?

    <p>43%</p> Signup and view all the answers

    Which cost structure is generally considered less risky for companies?

    <p>A high margin of safety</p> Signup and view all the answers

    If a t-shirt costs €8 to produce and is sold for €25, with daily fixed costs of €2,550, how many t-shirts must be sold to break even?

    <p>150</p> Signup and view all the answers

    A company has sales revenue of €300,000, variable costs of €60,000, and fixed costs of €210,000. What additional revenue is needed to increase profit by €2,400?

    <p>€3,000</p> Signup and view all the answers

    What does a higher variable cost proportion indicate about a company's cost structure?

    <p>Higher risk during economic downturns</p> Signup and view all the answers

    What would be the total depreciation for the computer equipment after two years of ownership given a cost of €75,000 and a residual value of €5,000?

    <p>€28,000</p> Signup and view all the answers

    How would the acquisition of new non-current assets for €40,000 affect the total carrying amount of non-current assets at year-end?

    <p>It increases the carrying amount by €40,000.</p> Signup and view all the answers

    In the statement of cash flows, how is a private withdrawal of €20,000 by an entrepreneur categorized?

    <p>As cash flows from financing activities.</p> Signup and view all the answers

    Which statement accurately describes trade payables?

    <p>It is the amount owed to suppliers for credit purchases.</p> Signup and view all the answers

    What is the net carrying amount of total non-current assets at the end of the year, given an initial value of €500,000 and the effects of depreciation and acquisitions?

    <p>€460,000</p> Signup and view all the answers

    How is the annual depreciation amount calculated for the computers in this scenario?

    <p>Cost minus residual value divided by useful life.</p> Signup and view all the answers

    Calculate the total budget for an advertisement that is clicked 2,000 times based on the given rate structure.

    <p>€1,200</p> Signup and view all the answers

    What does the residual value of computer equipment represent?

    <p>The estimated value of the asset at the end of its useful life.</p> Signup and view all the answers

    What is the amount paid by Anne-Sophie and Marie for their train tickets excluding the supplement?

    <p>€34.20</p> Signup and view all the answers

    What would be the total non-current assets reported in the statement of financial position after accounting for depreciation and new acquisitions?

    <p>€480,000</p> Signup and view all the answers

    How many hours per week must Sam work as a festival administrator to match his gross salary as a marketeer?

    <p>35 hours</p> Signup and view all the answers

    Calculate the effective tax rate Kim pays on her gift of €15,000 after accounting for the tax-free portion.

    <p>6.8%</p> Signup and view all the answers

    Which of the following statements best describes how the rates for the advertisement's clicks work?

    <p>Only the clicks after the initial 500 are calculated at a lower rate.</p> Signup and view all the answers

    What is the overall cost Marie incurs for her train ticket after applying her discount?

    <p>€18.00</p> Signup and view all the answers

    If Sam works 36 hours a week as a marketeer, what is his hourly wage based on his salary?

    <p>€25.00</p> Signup and view all the answers

    If the tax on Kim's gift is applied after the tax-free amount, how much of the gift is taxable?

    <p>€9,323</p> Signup and view all the answers

    Which of the following is classified as an asset?

    <p>Trade receivables from customers</p> Signup and view all the answers

    What is the calculated total amount of non-current assets for Rust Ltd?

    <p>€320,000</p> Signup and view all the answers

    How is cost of sales best categorized?

    <p>An expense and a cash payment</p> Signup and view all the answers

    If inventories purchased increase by €20,000, which profit levels are affected?

    <p>All profit levels including net profit are affected</p> Signup and view all the answers

    What will Reeds Ltd's total equity be on 31 December 2023?

    <p>€360,000</p> Signup and view all the answers

    What is the impact on profit levels after a decrease of €25,000 in interest costs?

    <p>EBIT and net profit increased by €25,000</p> Signup and view all the answers

    Which statement correctly describes retained earnings?

    <p>It reflects total equity after dividends are paid</p> Signup and view all the answers

    What component is NOT typically included in calculating cost of sales?

    <p>Sales revenue</p> Signup and view all the answers

    What is the correct calculation for the cost of sales if the beginning inventory is €50,000, purchases are €300,000, and the ending inventory is €60,000?

    <p>€290,000</p> Signup and view all the answers

    Which of the following statements about financial statements is correct?

    <p>The statement of cash flows reflects inventories purchased within a period.</p> Signup and view all the answers

    What is the cost of sales if a company has sales revenue of €200,000, purchases of €110,000, and a gross profit margin of 40%?

    <p>€140,000</p> Signup and view all the answers

    Which accounting concept primarily deals with the calculation of profit through sales and expenses?

    <p>Cost Accounting</p> Signup and view all the answers

    What would be the implication of an overstated inventory level in a company's financial statements?

    <p>Higher profit margins</p> Signup and view all the answers

    In the context of a company's financial position, how is gross profit defined?

    <p>Sales revenue minus cost of goods sold</p> Signup and view all the answers

    What financial statement would provide information on the company's cash transactions regarding inventory purchases?

    <p>Statement of Cash Flows</p> Signup and view all the answers

    If a company realizes higher sales revenue but retains the same cost of sales, what would be the financial effect?

    <p>Increased equity</p> Signup and view all the answers

    In which section of the statement of cash flows would a financing transaction be recorded?

    <p>Cash flows from financing activities</p> Signup and view all the answers

    What type of cost fluctuates directly with business activity levels?

    <p>A variable cost</p> Signup and view all the answers

    If a company expects 2,000 visitors and the break-even point is 1,400 visitors, what is the margin of safety?

    <p>43%</p> Signup and view all the answers

    To break even when selling t-shirts for €25 each with a cost of sales of €8 and fixed costs of €2,550, how many t-shirts need to be sold per day?

    <p>184 t-shirts</p> Signup and view all the answers

    If a company has sales revenue of €300,000, variable costs of €60,000, and fixed costs of €210,000, how much additional revenue is needed to increase profit by €2,400?

    <p>€3,000</p> Signup and view all the answers

    Which of the following is true about the relationship between profit and fixed costs?

    <p>Profit decreases as fixed costs increase</p> Signup and view all the answers

    What is the capacity utilisation rate of a restaurant with 40 seats, utilised 12 times a day, opened 350 days a year, and having 65,000 visits last year?

    <p>37%</p> Signup and view all the answers

    If a cinema has three halls, each with 100 seats and operates 12 hours daily except Monday and Tuesday, what is its maximum capacity per week?

    <p>18,000</p> Signup and view all the answers

    For the rollercoaster Taron with 4 seats in each of its 4 wagons, what is the duration of one ride, excluding boarding, if it serves 1,280 visitors per hour and the boarding time is 1 minute and 10 seconds?

    <p>1 minute and 50 seconds</p> Signup and view all the answers

    Which statement regarding unscheduled maintenance and excess capacity is correct?

    <p>Both statements are correct</p> Signup and view all the answers

    What is the total sales revenue recorded in the income statement if Hop Ltd made €50,000 in credit sales and €10,000 in cash sales during 2023?

    <p>€60,000</p> Signup and view all the answers

    Which action could help Dusk Ltd achieve a reduction of 10% in their operating expenses?

    <p>Reducing rent expenses</p> Signup and view all the answers

    Considering the average duration of a movie in a cinema is 2 hours, what is the total weekly operation time for the cinema if it operates 10 hours a day?

    <p>50 hours</p> Signup and view all the answers

    How is the purchase of inventories on credit reflected in the statement of cash flows?

    <p>Recorded as cash flows from operating activities</p> Signup and view all the answers

    What will happen to the standard cost price if costs change during the year?

    <p>The standard cost price changes as well</p> Signup and view all the answers

    Which statement about net profit is correct?

    <p>Net profit affects the movement in Equity.</p> Signup and view all the answers

    How many total visits must a rollercoaster with a maximum capacity of 1,280 visitors per hour achieve in one day to reach a total of 12,000 visits?

    <p>8 hours</p> Signup and view all the answers

    What total amount would be recorded in sales revenue if a company reports cash sales of €25,000 and credit sales of €35,000?

    <p>€60,000</p> Signup and view all the answers

    If a theme park's restaurant had 65,000 visits last year, what is the average number of visits per day?

    <p>Approx. 185</p> Signup and view all the answers

    In the context of financial reporting, which of the following is true regarding the relationship between net profit and cash flow?

    <p>Net profit can increase without a corresponding increase in cash flow.</p> Signup and view all the answers

    What is the impact of a transaction where a company purchases inventories on credit on its liabilities and cash flow?

    <p>Increases liabilities, does not affect cash flow.</p> Signup and view all the answers

    Which supplier offers the lowest total cost after including electricity, gas, and fixed costs for the entire year?

    <p>Supplier A is €1,842.22 cheaper.</p> Signup and view all the answers

    What is the total parking cost for Fred at the Station carpark from 17:00 to 21:00?

    <p>€6.00</p> Signup and view all the answers

    What is the minimum number of beer barrels Fred needs to purchase considering spillage?

    <p>10 barrels</p> Signup and view all the answers

    At what rate does the Q-Park carpark charge after 18:00?

    <p>4 cents per minute</p> Signup and view all the answers

    If a glass of beer is 15 cl, how many glasses can be filled from one barrel that holds 36 litres, if 20% is spilled before sale?

    <p>240 glasses</p> Signup and view all the answers

    What is the fixed yearly cost difference between Supplier A and Supplier B?

    <p>€70</p> Signup and view all the answers

    How does the hourly rate of the Cathedral carpark compare to that of the Q-Park carpark during night hours?

    <p>Cathedral carpark is more expensive.</p> Signup and view all the answers

    If Fred uses the Town Hall carpark, what is the cost for parking from 17:00 to 21:00?

    <p>€9.90</p> Signup and view all the answers

    Study Notes

    Exam Instructions - Financial Management

    • Exam: Financial Management
    • Year: 1
    • Month: February
    • Year: 2024
    • Exam Duration: 150 minutes
    • Exam Time: 9 February 2024 13:30 - 17:25
    • Number of Questions: 60
    • Pass Mark: 63%
    • Required Score: 37.98 points
    • Allowed Materials:
      • Textbook
      • Handwritten notes
      • Calculator (via Testvision)
      • Scrap paper (via Testvision)
    • ProctorExam Instructions (if applicable):
      • No headphones/earplugs
      • No talking/mumbling
      • Remain visible to camera

    Questions (Part A - Accounting)

    • Question 1 (Multiple Choice): Calculate the cost of sales given beginning inventory (€50,000), purchases (€300,000), and ending inventory (€60,000).
    • Question 2 (Multiple Choice): Determine which statement(s) are correct: Statement 1: The statement of financial position shows the inventories sold in a period of time. Statement 2: The statement of cash flows shows the total amount of inventories purchased in a period of time.
    • Question 3 (Multiple Choice): Calculate the cost of sales: Sales revenue (€200,000), purchases (€110,000), gross profit margin (40%).
    • Question 4 (Multiple Choice): Identify the asset among the options: Depreciation costs of a motor vehicle, Retained earnings, Trade receivables, Bank loan to finance new IT hardware.

    Questions (Part A - Accounting) Continued

    • Question 5 (Multiple Choice): Determine the total amount of non-current assets given the following information: Inventories (€65,000), Software licenses (€100,000), Equipment (€320,000), Trade receivables (€40,000), Trade payables (€70,000), Cash at bank (€60,000), Equity (€150,000).
    • Question 6 (Multiple Choice): Classify "cost of sales": Expense, expense and a cash payment, neither an expense nor a cash payment, a cash payment.
    • Question 7 (Multiple Choice): Determine the direct effect on profit levels following a €20,000 increase in inventory purchases.
    • Question 8 (Multiple Choice): Calculate the equity value on 31 December 2023 given 1 January 2023 equity (€280,000), net profit (€50,000), net cash flow (€30,000).

    Questions (Part B - Break-Even Analysis)

    • Question 9 (Multiple Choice): Calculate the effect on profits given a decrease in interest costs of €25,000 (holding other income elements constant).
    • Question 10 (Multiple Choice): Given different accounting and equipment information about a purchase, determine the annual depreciation charge.
    • Question 11 (Multiple Choice): Determine the carrying amount of non-current assets given a €500,000 opening balance, €60,000 depreciation charge, and €40,000 additions.
    • Question 12 (Multiple Choice): Identify the location on the statement of cash flows for the withdrawal of €20,000 from a company for personal use.

    Questions (Part B - Break-Even Analysis) Continued

    • Question 13 (Multiple Choice): Determine the correctness of statements 1 and 2 regarding the balance of trade payables.
    • Question 14 (Multiple Choice): Calculate the depreciation charge for new computer equipment acquired June 1, 2023, with a given cost, useful life, and residual value.
    • Question 15 (Multiple Choice): Calculate total sales revenue from credit and cash sales given sales figures (credit €50,000, cash €10,000).
    • Question 16 (Multiple Choice): Select an option to reduce operating expenses by 10%.

    Questions (Part B - Break-Even Analysis) Continued

    • Question 17 (Multiple Choice): Determine the location on the statement of cash flows when a company makes inventory purchases on credit.
    • Question 18 (Multiple Choice): Determine the correctness of statements about net profit and its effect on equity and bank balances.
    • Question 19 (Multiple Choice): Calculate the value of trade receivables as of December 31, 2023 given the beginning balance, credit sales, and cash collections.
    • Question 20 (Multiple Choice): Calculate a company's gross profit given sales revenue, cost of sales, and purchases figures.

    Questions (Part B - Break-Even Analysis) Continued

    • Question 21 (Multiple Choice): Determine the effect on current assets after direct payment of €5,000 for inventory purchases.
    • Question 22 (Multiple Choice): Calculate the cost of new inventory purchased given beginning, ending, and cost of sales figures.
    • Question 23 (Multiple Choice): Determine the account in which rent expenses are recorded.
    • Question 24 (Multiple Choice): Calculate the amount repaid on a €5,000,000 loan with 10-year repayment at 6% interest.

    Questions (Part B - Break-Even Analysis) Continued

    • Question 25 (Multiple Choice): Calculate the effect on profit levels after a customer payment for previously credit sales.
    • Question 26 (Multiple Choice): Determine where a net cash flow of €50,000 is recorded in the financial statement.
    • Question 27 (Multiple Choice): Determine the correctness of statements about the reporting of office equipment.
    • Question 28 (Multiple Choice): Calculate the ending balance of a loan given the beginning balance, repayments, and interest expenses.

    Questions (Part B - Break-Even Analysis) Continued

    • Question 29 (Multiple Choice): Determine the effect on the financial statements (balance sheet) from repaying a loan.
    • Question 30 (Multiple Choice): Determine the location on the statement of cash flows where a company makes a salary payment.
    • Question 31 (Multiple Choice): Given the break-even point and margin of safety, calculate expected visits.
    • Question 32 (Multiple Choice): Identify the type of cost that is directly connected to business activity.

    Questions (Part C - Capacity)

    • Question 33 (Multiple Choice): Calculate the margin of safety given the expected number of visitors and break-even point.
    • Question 34 (Multiple Choice): Identify the less risky cost structure.
    • Question 35 (Multiple Choice): Calculate the number of t-shirts to be sold per day to break even given sales price, cost of sales, and fixed costs.
    • Question 36 (Multiple Choice): Calculate the required additional revenue to increase profit by a specified amount given revenue, variable and fixed costs information.

    Questions (Part C - Capacity) Continued

    • Question 37 (Multiple Choice): Determine the cost classification for €4000 monthly insurance payments.
    • Question 38 (Multiple Choice): Calculate the break-even point in the number of visitors for an event given the ticket price, food/drink spending per visitor, fixed cost, and variable cost per visitor.
    • Question 39 (Multiple Choice): Classify the fixed fee an event organiser pays per visitor to the venue owner.
    • Question 40 (Multiple Choice): Given contribution per visitor, fixed cost, and variable cost per visitor, calculate the break-even point.

    Questions (Part C - Capacity) Continued

    • Question 41 (Multiple Choice): Calculate the standard cost price of one overnight stay given information about occupancy, fixed costs, and variable costs.
    • Question 42 (Multiple Choice): Identify correct answers about ways to increase a restaurant's capacity (statement 1: adding seats, statement 2: extending hours)
    • Question 43 (Multiple Choice): Determine correctness of statements about standard cost price accuracy.
    • Question 44 (Multiple Choice): Calculate the capacity utilization rate for a theme park restaurant given seat utilization, operating days, and total visitor counts.

    Questions (Part C - Capacity) Continued

    • Question 45 (Multiple Choice): Calculate the duration of one ride on a rollercoaster given wagon size, train composition, and boarding times (exclude boarding times).
    • Question 46 (Multiple Choice): Identify the correct statement(s) on unintended excess capacity and its effects.
    • Question 47 (Multiple Choice): Estimate the maximum weekly capacity of a cinema given its opening hours, number of halls, seating per hall, and closure days.
    • Question 48 (Multiple Choice): Determine the additional wagons required to increase capacity by a minimum.

    Questions (Part D - Numeracy)

    • Question 49 (Multiple Choice): Calculate the capacity utilization rate of a football stadium over 19 home games.
    • Question 50 (Multiple Choice): Determine the accuracy of statements 1 and 2 about unintended and intended excess capacity in the context of theme parks.
    • Question 51 (Multiple Choice): Calculate the savings from choosing the lower-cost supplier for stage equipment, given details of cost, delivery, and import duty, considering the exchange rates.
    • Question 52 (Multiple Choice): Calculate the cost required for flooring renovation work given area dimensions, non-tiling areas, and material costs, including wastage allowance.

    Questions (Part D - Numeracy) Continued

    • Question 53 (Multiple Choice): Estimate the cost of ingredients required for a set number of cookies given different ingredient quantities and costs (including butter, sugar, eggs, oats, raisins).
    • Question 54 (Multiple Choice): Compare the cost of electricity and gas contracts for your business (supplier A and B) giving the rate, fixed cost, and expected usage for electricity (kWh) and gas (m^3.)
    • Question 55 (Multiple Choice): Determine the cheapest parking option given the cost per hour and per 10 minutes for different parking lots, considering various rates.
    • Question 56 (Multiple Choice): Calculate the number of beer barrels required for an event given the capacity of each barrel, average beer consumption per visit, and the expected number of drinks.

    Questions (Part D - Numeracy) Continued

    • Question 57 (Multiple Choice): Calculate the total cost to budget for a pay/click online advertising campaign given different price tiers depending on the frequency of clicks.
    • Question 58 (Multiple Choice): Calculate the discount percentage on a train ticket for a child given the regular price, supplement, and total cost of the trip for two people(child and another person)
    • Question 59 (Multiple Choice): Calculate the required working hours to maintain the same gross salary given monthly salary figures and differing numbers of hours for different roles.
    • Question 60 (Multiple Choice): Calculate the effective tax rate for a gift considering a tax-exempt portion.

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    Financial Management Past Paper PDF 2024 (Year 1)

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    Prepare for your first-year Financial Management exam with this comprehensive quiz. Covering accounting fundamentals, including calculations of cost of sales and financial statements, this quiz will help you assess your understanding of key concepts. With 60 questions and a pass mark of 63%, it's an essential review before the exam.

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