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Free ACCA Performance Management Practice Questions & Answers

400 exam-style Performance Management questions. Pick your answer, hit Check answer, and see the worked solution — free to start, no signup.

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Question 61

A company's target selling price is 90. Required margin (on selling price) is 25%. Current cost is 72. Calculate target cost and cost gap.

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Question 62

Using a learning curve rate of 80%, the first unit takes 200 hours. What are cumulative average hours per unit for 2, 4 and 8 units?

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Question 63

A product has a C/S ratio of 35% and fixed costs are 280,000. What is the break-even revenue?

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Question 64

Budgeted sales: 10,000 units. Break-even: 6,500 units. Calculate the margin of safety as a percentage.

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Question 65

A company makes products P and Q. P: contribution 24, machine hrs 3. Q: contribution 18, machine hrs 2. Machine hours available: 6,000. Max demand P: 1,200 units; Q: 1,800 units. Optimal production plan?

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Question 66

A company has: sales 500,000; variable costs 300,000; fixed costs 150,000. Calculate: gross profit margin, net profit margin, and C/S ratio.

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Question 67

Environmental management accounting identifies four cost categories. Which is a prevention cost?

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Question 68

A company has throughput accounting data: Selling price 120/unit; Direct material 45/unit; Total Factory Costs 600,000/period; Bottleneck capacity 10,000 hrs/period; Product uses 2 hrs on bottleneck. Calculate TA ratio.

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Question 69

A company has: fixed costs 300,000; selling price 80/unit; variable cost 50/unit. If the company wants to earn a target profit of 90,000, how many units must be sold?

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Question 70

A company uses activity-based costing for a service business. Activities: customer account management (160,000; driver: number of accounts; 800 accounts). Product design (80,000; driver: design hours; 1,600 hrs). IT support (40,000; driver: users; 200 users). Customer A: 50 accounts, 120 design hrs, 8 users. Calculate Customer A's overhead cost.

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Question 71

A company has two products. Product 1: selling price 80, variable cost 48, max demand 4,000 units, machine hours required 3. Product 2: selling price 60, variable cost 42, max demand 6,000 units, machine hours required 2. Total machine hours available: 18,000. Fixed costs: 100,000. Calculate optimal profit.

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Question 72

A product has: standard variable cost 25/unit, target selling price 40/unit, required margin 20% on selling price. Is this product viable at current cost?

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Question 73

A company's current absorption costing system shows Product X is unprofitable (absorbed cost 52, selling price 48). ABC analysis reveals Product X consumes far fewer support activities than average. Under ABC its cost is 38. What decision does this change?

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Question 74

A product has: VC 30, FC absorbed 20, selling price 60. Under absorption costing 2,000 units produced and 1,800 sold. Calculate the closing inventory value and the profit.

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Question 75

A company makes a product in batches. Each batch setup costs 500. Each unit costs 8 to make. Selling price 20/unit. Batches contain 100 units. Maximum demand 5,000 units. What is the optimal batch structure if setup cost is a fixed cost per batch?

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Question 76

A company's management accountant calculates that increasing advertising spend by 50,000 would increase sales volume by 8%. Current contribution is 400,000. Is this worthwhile?

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Question 77

Using the high-low method with three data points: 800 units — 14,000; 1,000 units — 16,500; 1,400 units — 21,500. Calculate VC per unit and FC.

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Question 78

A service organisation has total costs of 800,000. Variable costs are 60% of total. It serves 10,000 customers. What is the full cost per customer and the variable cost per customer?

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Question 79

A company has just launched a new product. The first unit took 400 hours. The learning curve rate is 80%. How many hours will it take to complete the 4th unit (not the average)?

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Question 80

A company makes 3,000 units and sells 2,500. Standard variable cost: 15/unit; fixed overheads: 30,000. Under marginal costing, what is inventory value?

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Question 81

A company manufactures and sells 4,000 units. Fixed costs: 60,000. Variable cost: 18/unit. Selling price: 35/unit. Calculate: (a) break-even units (b) current margin of safety (c) profit.

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Question 82

A company has: fixed costs 150,000; C/S ratio 0.45. Calculate: (a) break-even revenue; (b) revenue needed to earn target profit of 60,000.

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Question 83

Company makes A, B, C. Contribution/unit: A=30, B=20, C=15. Machine hours/unit: A=3, B=1, C=2. Max demand: A=2,000, B=5,000, C=3,000. Available hours=14,000. Fixed costs=80,000. Find optimal plan and profit.

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Question 84

A company is deciding whether to switch from absorption costing to throughput accounting for management decision-making. It has high fixed overheads (70% of total cost), one clear bottleneck (machine X), and three products with different machine X time requirements. Evaluate which approach is more appropriate for optimising short-run decisions.

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Question 85

A company with three products uses ABC. Setup pool: 120,000 (800 total setups). Machining: 200,000 (40,000 total machine hrs). Inspection: 80,000 (2,000 total inspections). Product X: 150 setups, 8,000 hrs, 400 inspections. Product Y: 300 setups, 20,000 hrs, 1,000 inspections. Product Z: 350 setups, 12,000 hrs, 600 inspections. Calculate total ABC overhead for each product.

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Question 86

A company has: sales 2,000,000; variable costs 1,200,000; fixed costs 600,000; profit 200,000. It is considering increasing fixed costs by 120,000 (advertising) to boost sales by 15%. Assess the decision.

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Question 87

A company uses throughput accounting. Two products compete for bottleneck time on Machine X. Product A: price 150, materials 60, Machine X time 3 hrs. Product B: price 120, materials 40, Machine X time 2 hrs. TFC = 400,000/period. Machine X available: 8,000 hrs. Max demand: A=1,500 units; B=2,500 units. Calculate optimal plan and RI (throughput profit after TFC).

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Question 88

A company is considering implementing kaizen costing alongside its existing standard costing system. Describe the relationship between the two and how they complement each other.

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Question 89

Good management information should be:

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Question 90

Big Data is characterised by:

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Free ACCA Performance Management Practice Questions & Answers

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