Question

i ne S DECISION MAKING TO IMPROVE THAN Which of these term 04 A Total Costs Total Total Reven Total 3.5 DECISION MAKING TO IMPROVE FINANCIAL PERFORMANCE MCQ TEST 1 Instructions: • There are 15 questions in this test Your teacher will determine how long you have to complete this test and under who conditions Only one answer per question is allowed. For each answer completely in the circle alongside the appropriate answer If you want to change your answer you o ut your original answer. If you wish to return to an answer previously crossed out, ring the answer you now wish to JAVA VORMIOTAM 01 I 19TO For an office-based professional services business, leasing would be the most appropriate way to finance the purchase of: A Inventories B Company cars C Land and buildings D Advertising campaigns no colocar novos anos a nos 1 mark onemoholsonovom obr o nno A reduction in the quantity or value of inventories held would normally: 02 A Improve cash flow B Worsen cash flow C Increase operating profit 00000000000 D Reduce fixed costs 1 mark 03 The sales budget assumed 200 units would be sold for £15 each; actual sales were £4,200. What was the sales variance? A £3,000 (A) 8 £3,000 (F) C £1,200 (A) D £1,200 (F) 1 mark Copyright Tutoru Limited 2016 All Rights Reserved www.tutor2u.net

Answer 1

Q- 1

Option - C   Land and Buildings

Inventories and advertising campaigns are not at all suitable for leasing.

So, choice is between ....... Land and buildings and company cars.As the question indicates, business model is office based service, hence land and building is most preferred leasing option.

Q - 2 )  

Option - A Improves cash flows

A decrease in quantity or value of inventory releases cash blocked in the inventory. Hence it increases cash flows.

Q - 3)

Option - (D) 1200 F

= 200 * 15 - 4200

= 3000 - 4200

= 1200 F

Favorable, because, actual sales revenue is more than the budgeted sales revenue.