You’re on a roll
Create a free account to save your ACCA progress, track your accuracy by topic, and pick up right where you left off.
Free Questions › ACCA › Strategic Business Leader
Free ACCA Strategic Business Leader Practice Questions & Answers
300 exam-style Strategic Business Leader questions. Pick your answer, hit Check answer, and see the worked solution — free to start, no signup.
100% free · No login to startQuestion 211
What is 'asset turnover ratio'?
Select an option first.
Correct answer: B — A measure of how efficiently an organisation uses its assets to generate revenue — calculated as revenue divided by total assets
Explanation: B is correct. Asset turnover = Revenue / Total Assets. It shows how much revenue is generated per unit of assets employed. Combined with net profit margin, it explains ROCE (Dupont analysis). A, C and D are unrelated.
Question 212
What is the DuPont analysis?
Select an option first.
Correct answer: B — A framework that decomposes ROCE (or ROE) into its component drivers — profit margin and asset turnover — to identify the source of performance improvement or decline
Explanation: B is correct. DuPont: ROCE = Net Profit Margin × Asset Turnover. It reveals whether performance is driven by profitability (charging more / controlling costs) or asset efficiency (generating more revenue from the asset base). A, C and D are unrelated.
Question 213
What is 'working capital management'?
Select an option first.
Correct answer: B — Managing the short-term assets and liabilities — inventory, receivables, payables, and cash — to ensure adequate liquidity for day-to-day operations while minimising the cost of holding assets
Explanation: B is correct. Working capital = Current Assets − Current Liabilities. Effective management ensures the organisation can meet its obligations while not tying up excessive cash in inventory or receivables. A, C and D describe different management activities.
Question 214
What is 'economic value added' (EVA)?
Select an option first.
Correct answer: B — A measure of the economic profit generated by an organisation after deducting the total cost of capital (debt and equity) from net operating profit after tax
Explanation: B is correct. EVA = NOPAT − (Capital Employed × Weighted Average Cost of Capital). Positive EVA means value is being created above the cost of all capital. It is more comprehensive than accounting profit, which ignores the cost of equity capital. A, C and D describe different economic measures.
Question 215
What is 'shareholder value analysis' (SVA)?
Select an option first.
Correct answer: B — A framework (Rappaport) focusing on whether management decisions create or destroy value for shareholders by generating returns above the cost of capital
Explanation: B is correct. SVA evaluates strategic decisions based on their expected impact on shareholder value — considering cash flows, risk, and the cost of capital. It challenges earnings-based performance measures that may not reflect genuine value creation. A, C and D are unrelated.
Get the full ACCA question bank — free
Drop your email and we'll send you fresh ACCA practice questions, fully worked solutions and exam-deadline reminders. No spam — unsubscribe in one click.
Want to save your score and take a full mock exam? Create a free account →
Question 216
What is a 'project' in a project management context?
Select an option first.
Correct answer: B — A temporary endeavour with a defined start and end, undertaken to create a unique product, service, or result — distinguishable from ongoing operations by its temporary and unique nature
Explanation: B is correct. Projects are temporary (time-bound) and unique (not routine). This distinguishes them from ongoing operations. Key project characteristics: defined scope, schedule, budget, and deliverables. A and C describe operations. D is a planning activity.
Question 217
What is a 'project management triangle' (iron triangle)?
Select an option first.
Correct answer: B — A model showing the three constraints on a project — scope, time, and cost — and the trade-offs between them, where changing one affects the others
Explanation: B is correct. The project management triangle (also called the iron triangle) illustrates that quality emerges from managing the balance between scope (what you deliver), time (when you deliver it), and cost (resources used). Expanding scope with the same time and cost reduces quality or requires compromises elsewhere.
Question 218
What is a 'work breakdown structure' (WBS)?
Select an option first.
Correct answer: B — A hierarchical decomposition of a project into smaller, manageable components and work packages, providing a complete picture of the total scope of work
Explanation: B is correct. The WBS decomposes the total project deliverables into progressively smaller chunks until work packages can be realistically estimated and assigned. It underpins scheduling, cost planning, and progress monitoring. A, C and D mischaracterise it.
Question 219
What is a 'Gantt chart'?
Select an option first.
Correct answer: B — A horizontal bar chart showing project tasks, their duration, sequence, and dependencies — enabling visual tracking of schedule progress
Explanation: B is correct. Gantt charts are the most widely used project scheduling tool. They display tasks as horizontal bars along a timeline, showing start/end dates, dependencies, and current progress. A, C and D are different chart types.
Question 220
What is the 'critical path' in project management?
Select an option first.
Correct answer: B — The longest sequence of dependent tasks in a project, determining the minimum time to complete the project — any delay on the critical path delays the entire project
Explanation: B is correct. Critical path analysis (CPA) identifies the sequence of tasks with zero float (slack). Delays on the critical path directly delay the project end date. Non-critical path tasks have float — they can slip within limits without affecting the overall schedule. A, C and D are incomplete or incorrect.
Question 221
What is 'float' (slack) in project management?
Select an option first.
Correct answer: B — The amount of time a non-critical task can be delayed without affecting the project completion date
Explanation: B is correct. Float is the scheduling flexibility on non-critical tasks. A task with 5 days of float can start 5 days late or take 5 days longer without delaying the project. Critical path tasks have zero float. A, C and D are unrelated.
Question 222
What is a 'RACI matrix' in project management?
Select an option first.
Correct answer: B — A responsibility assignment matrix identifying who is Responsible, Accountable, Consulted, and Informed for each task — clarifying roles and reducing overlap or gaps
Explanation: B is correct. The RACI matrix prevents confusion about roles: Responsible (does the work), Accountable (owns the outcome), Consulted (provides input), Informed (receives updates). It is essential for complex projects with multiple stakeholders. A, C and D are unrelated.
Question 223
What is 'scope creep' in project management?
Select an option first.
Correct answer: B — The uncontrolled, gradual expansion of project scope beyond its original definition — adding features or requirements without corresponding adjustments to schedule, budget, or resources
Explanation: B is correct. Scope creep is one of the most common causes of project failure. It occurs when stakeholders request additional features without a formal change control process. Effective change control and scope management prevent scope creep. A, C and D are unrelated.
Question 224
What is 'change control' in project management?
Select an option first.
Correct answer: B — A formal process for evaluating, approving, and documenting any proposed changes to the project's scope, schedule, or budget
Explanation: B is correct. Change control ensures that proposed changes are assessed for impact before approval, preventing uncontrolled scope creep and maintaining the integrity of the project baseline. A, C and D mischaracterise it.
Question 225
What is 'agile project management'?
Select an option first.
Correct answer: B — An iterative, flexible approach to project management that delivers value in short increments (sprints), responds to changing requirements, and involves continuous stakeholder feedback
Explanation: B is correct. Agile (Scrum, Kanban) contrasts with traditional waterfall approaches by delivering working products in short cycles, welcoming change, and involving customers continuously. It is particularly suited to software development and innovation projects where requirements evolve. A, C and D mischaracterise agile.
Question 226
What is a 'project sponsor' and why are they important?
Select an option first.
Correct answer: B — A senior executive who owns the business case, provides strategic direction, removes barriers, and ensures the project remains aligned with organisational priorities
Explanation: B is correct. The project sponsor is the senior champion — they approve resources, resolve escalated issues, and ensure the project delivers business value. Without an effective sponsor, projects lack strategic alignment and senior support. A, C and D describe different project roles.
Question 227
What is 'earned value management' (EVM)?
Select an option first.
Correct answer: B — A project performance measurement technique integrating scope, schedule, and cost to assess project progress and forecast completion
Explanation: B is correct. EVM compares planned value (budgeted cost of scheduled work), earned value (budgeted cost of completed work), and actual cost — enabling schedule variance (SV) and cost variance (CV) to be calculated, and forecasting the final cost and completion date. A, C and D are unrelated.
Question 228
What is 'talent management'?
Select an option first.
Correct answer: B — The integrated set of processes for attracting, developing, motivating, and retaining individuals who have the skills and potential to make the greatest contribution to organisational success
Explanation: B is correct. Talent management encompasses workforce planning, recruitment, development, performance management, succession planning, and retention — ensuring the organisation has the human capability to execute its strategy. A, C and D describe narrow activities.
Question 229
What is 'succession planning'?
Select an option first.
Correct answer: B — The proactive process of identifying and developing internal candidates to fill critical leadership roles when they become vacant, ensuring continuity and capability
Explanation: B is correct. Succession planning ensures leadership continuity by developing a pipeline of internal talent. It reduces dependency on key individuals (key man risk) and supports strategic execution. A and C are narrower financial concepts. D is external recruitment, not succession planning.
Question 230
What is 'performance management' in an organisational context?
Select an option first.
Correct answer: B — A continuous process of setting expectations, monitoring performance, providing feedback and development, and aligning individual contribution with organisational objectives
Explanation: B is correct. Performance management is ongoing and developmental — it includes goal-setting, regular check-ins, coaching, recognition, and development planning. A implies it is purely disciplinary. C is one element. D is financial control.
Question 231
What is the difference between 'outputs' and 'outcomes' in performance measurement?
Select an option first.
Correct answer: B — Outputs are the direct deliverables produced by an activity (e.g., training courses delivered); outcomes are the broader changes in behaviour or condition that result from those outputs (e.g., improved staff competence)
Explanation: B is correct. The output/outcome distinction is crucial in performance management: producing outputs does not guarantee outcomes. For example, a hospital may deliver many treatments (outputs) without necessarily improving population health (outcomes). A and C apply false criteria. D is incorrect.
Question 232
What is a 'dashboard' in management reporting?
Select an option first.
Correct answer: B — A visual management reporting tool presenting key performance indicators and metrics in a concise, real-time format to enable rapid monitoring and decision-making
Explanation: B is correct. Management dashboards display KPIs using charts, traffic lights, and gauges, enabling leaders to quickly assess performance across multiple dimensions. They are distinct from detailed analytical reports. A is physical. C and D are specific analytical or compliance tools.
Question 233
What is 'variance analysis' in management accounting?
Select an option first.
Correct answer: B — The process of comparing actual results against budgeted or standard figures, investigating the causes of significant differences, and taking corrective action
Explanation: B is correct. Variance analysis (favourable/adverse variances for sales, costs, volume, and price) is a core management accounting control tool. It directs management attention to areas needing action. A, C and D mischaracterise it.
Question 234
What is 'non-financial performance measurement' and why is it important?
Select an option first.
Correct answer: B — Tracking indicators that are not directly monetary — such as customer satisfaction, employee engagement, quality metrics, and environmental impact — which often predict future financial performance
Explanation: B is correct. Non-financial measures are leading indicators — they predict future financial outcomes. Customer dissatisfaction now predicts revenue loss later; poor quality now predicts warranty costs later. Balancing financial and non-financial measures gives a complete performance picture. A, C and D are incorrect interpretations.
Question 235
What is 'throughput accounting' in performance management?
Select an option first.
Correct answer: B — A management accounting approach focusing on maximising the rate at which the system generates money, identifying and exploiting constraints that limit throughput
Explanation: B is correct. Throughput accounting (Goldratt's Theory of Constraints) focuses on three metrics: throughput (revenue minus direct material costs), investment (assets), and operating expenses. The goal is to maximise throughput while reducing investment and operating expenses. A, C and D are unrelated.
Question 236
What is 'transfer pricing' in a multinational company context?
Select an option first.
Correct answer: B — The price at which transactions occur between related entities within the same corporate group, which can affect the distribution of profit between jurisdictions for tax purposes
Explanation: B is correct. Transfer pricing determines how profit is allocated between group entities in different tax jurisdictions. Regulatory bodies require arm's length pricing to prevent profit shifting. A, C and D are unrelated.
Question 237
What is 'target costing'?
Select an option first.
Correct answer: B — A market-driven cost management approach where the desired profit margin is deducted from the target market price to arrive at the maximum allowable cost, which then drives product design and cost reduction
Explanation: B is correct. Target costing (Toyota-derived): Target Cost = Market Price − Desired Profit Margin. It forces value engineering — designing the product to meet cost targets rather than designing the product then calculating the cost. B reverses the traditional approach. A, C and D are different cost management tools.
Question 238
What is 'life cycle costing' (LCC)?
Select an option first.
Correct answer: B — An approach that considers all costs associated with an asset or product over its entire life — from acquisition and operation to maintenance and disposal — not just the initial purchase price
Explanation: B is correct. LCC reveals the true total cost of ownership. A cheap product to buy may be expensive to maintain or dispose of. It is particularly important for infrastructure, defence, and large capital assets. A and C are different lifecycle concepts. D is a narrower project cost concept.
Question 239
What is 'activity-based costing' (ABC)?
Select an option first.
Correct answer: B — A costing method that assigns overheads to products based on the activities that consume resources, using cost drivers to achieve more accurate cost allocation than traditional volume-based methods
Explanation: B is correct. ABC recognises that overheads are caused by activities (e.g., machine setups, purchase orders, quality inspections), not just by volume. It identifies cost drivers and allocates overhead more accurately to products or services. A, C and D describe different approaches.
Question 240
What is a 'balanced scorecard' strategy map?
Select an option first.
Correct answer: B — A visual representation of the cause-and-effect relationships between objectives across the four balanced scorecard perspectives, showing how improving one objective contributes to achieving others
Explanation: B is correct. The strategy map (Kaplan and Norton) shows explicitly how objectives in the learning and growth perspective enable improvements in processes, which improve customer outcomes, which drive financial results. It is a strategic communication and alignment tool. A, C and D are different tools.
More free ACCA topics
Management Accounting401
Financial Accounting400
Corporate and Business Law400
Performance Management400
Financial Reporting400
Financial Management400
Strategic Business Reporting400
Advanced Financial Management400
Advanced Performance Management400
Advanced Taxation400
Business and Technology300
Taxation300
Audit and Assurance300
Advanced Audit and Assurance296
Ten questions in
- The ones you miss are saved as a drill you can repeat
- Your place is kept, on this device and any other
- A streak, if that is the thing that gets you back tomorrow
Every question on this page stays free and open either way.