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Exam Code: CIMAPRA19-P02-1-ENG
Exam Questions: 205
P2 Advanced Management Accounting (Online)
Updated: 23 May, 2026
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Question 1

A company manufactures and sells a range of products. Relevant data for one unit of a particular product are as follows.

1

The company is using target costing to ensure that it achieves a contribution of 40% of the market selling price.
In order to achieve the target cost, by how much does the company need to reduce the variable cost per unit?

Options :
Answer: B

Question 2

Division A is an investment centre with assets of $7.3 million. The following is an extract from the annual budget for division A:

1

The cost of capital is 14%.
Calculate the residual income for division A.

Options :
Answer: A

Question 3

A company is classifying its quality costs to prepare a quality cost report. Which of the following are conformance costs?
Select ALL that apply.

Options :
Answer: C,D

Question 4

One of an investment centre's products is sold on an external market. Output is limited because the specialist machine that manufactures the product is operating at full capacity.

Current data for the product are as follows.

1

Options :
Answer: A

Question 5

When considering a capital investment, relevant costs for decision making have which THREE of the following features?

Options :
Answer: A,C

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