a)
Qualities of cost and management information:

1. Relevance: Information should be timely and bear on the decision-making process by possessing predictive or confirmatory (feedback) value.
2. Faithful representation: Information must be honestly presented, complete, neutral, and free from material error and misstatement.
3. Comparability: Even though different companies may use different accounting methods, there is still sufficient basis for valid comparison.
4. Consistency: Deviations in measured outcomes from period to period should be the result of deviations in underlying performance (not accounting quirks).
5. Verifiability: Different knowledgeable and independent observers reach similar conclusions.
6. Timeliness: Cost and revenue information not readily available to the organization at the right time for decision making is of no use. Information must flow to the decision maker at the right time and at the right place so that it can be of use to the decision maker.
   (Any 5 points @ 2 marks each = 10 marks)

b)
i) Cost center: This is a segment of the organization that has the authority to incur and control cost. Expense center is a responsibility center incurring only expense items and producing no direct revenue from the sale of goods or services. An example of expense centers are service centers, thus the maintenance department and accounting department of an organization. (2.5 marks)

ii) Profit center: Profit center is a responsibility center having both revenues and expenses objectives because segmental earnings equal segmental revenues minus related expenses; therefore, the manager must be able to control both of these categories of revenue and cost. (2.5 marks)

c)
The following are the major differences between marginal costing and absorption costing:

1. Cost Inclusion: Marginal Costing apportions only variable costs to the products, while Absorption Costing absorbs both fixed and variable costs into the product cost.
2. Profit Calculation: Marginal costing profit is calculated using the Contribution Margin (Sales – Variable Costs), whereas Absorption Costing calculates profit after deducting both fixed and variable costs from sales.
3. Overhead Treatment: Marginal Costing treats fixed overheads as period costs, charged against revenue in the period incurred, while Absorption Costing includes fixed overheads in the product cost.
4. Stock Valuation: Under Marginal Costing, stock is valued at variable cost, whereas under Absorption Costing, stock is valued at full cost (including fixed overheads).
5. Presentation of Profit: Marginal Costing profit varies directly with sales volume, while Absorption Costing profit can vary with changes in stock levels due to fixed overheads absorption.
   (Any 2 points @ 2.5 marks each = 5 marks)
   (Total: 20 marks)