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Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
(a) You are preparing for a job interview as a risk manager. This requires you to make a ten-minute presentation on the functions and determinants of the efficiency of a risk manager.
Required:
Present an outline of your 10-minute presentation. (10 Marks)
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Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
(b) The public sector is the driver of the economies of many developing nations. Public Finance Management has become a focus of attention in these economies. Development partners have therefore drawn the attention of governments to the Nolan Committee’s report on Standards in Public Life.
Required:
Discuss SIX of these principles for public office holders and show how they can enhance performance in the public sector. (6 Marks)
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Find Related Questions by Tags, levels, etc.
Negative Goodwill is based on the accounting concept of Goodwill, an intangible asset that represents the worth of a company’s brand name, patents and other intellectual property, customer base, licenses, and other items that are difficult to put an amount on but help to make a company valuable. When the price paid is less than the actual value of the company’s net tangible assets, negative goodwill results.
Required:
In accordance with IFRS 3: Business Combinations, identify THREE (3) factors that account for negative goodwill and indicate its accounting treatment when it occurs in the preparation of consolidated financial statements.
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GRAT Authority operates passenger railway services and is responsible for the maintenance of track signaling equipment, and other facilities such as stations. In recent years it has been criticized for providing poor services to the traveling public in terms of punctuality, safety, and the standard of facilities offered to passengers. Last year, GRAT Authority invested over GH¢20 million in new carriages, station facilities, and track maintenance programs in an attempt to address these criticisms.
Summarized financial results for GRAT Authority for the last two years are given below:
Extracts of Statement of Profit or Loss account for the year ended 31 December
Statement of Financial Position as at 31 December
Required:
a) Calculate the following ratios for GRAT Authority for 2017 and 2018, clearly showing your workings.
i) Return on capital employed (ROCE)
ii) Net profit margin
iii) Asset turnover
iv) Current ratio
b) Evaluate the financial performance of the entity in 2017 and 2018 as revealed by the above ratios.
c) Suggest THREE (3) non-financial indicators that could be useful in measuring the performance of a passenger railway service and explain why your chosen indicators are important.
d) Explain the term short-termism and suggest ways in which a long-term view can be encouraged.
(Total: 20 marks)
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a) Management Accountants are often engaged in decision-making processes that would yield optimal results, given a limited amount of resources available. Such decisions are expected to yield to shareholder wealth maximization through the maximization of profits. Unfortunately, however, constraints sometimes lead to satisficing rather than optimizing decision making.
Required:
i) Explain how profit maximization can lead to shareholder wealth maximization. (4 marks)
ii) Explain how constraints, satisficing, and optimizing affect the management accountant’s decision-making. (6 marks)
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b) The following monthly budgeted cost values have been taken from the budget working papers of MZ Ltd for the year ended 30 September 2019.
During May 2019, actual costs for the activity level of 82% were as follows:
Item GH¢
Direct Materials 10,500
Direct Labour 12,250
Direct Expenses 5,600
Production Overhead 6,250
Selling Overhead 15,150
Administration Overhead 14,200
Total 63,950
Required:
Prepare a budgetary control statement for MZ Ltd on a flexible budget basis for the month of May 2019.
(10 marks)
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Find Related Questions by Tags, levels, etc.
b) Sasraku Ltd manufactures and sells standard quality fuel pumps. Other companies integrate these pumps in their production of petrol engines. At present, Sasraku Ltd manufactures only three different types of fuel pumps: oil pump, gas pump, and diesel pump. Simon, the Management Accountant, allocates fixed overheads to these pumps on an absorption costing system.
The standard selling price, volumes, and cost data for these three products for the last period are as follows:
The total fixed production overhead for the last period was estimated in the budget to be GH¢526,500. This was absorbed on a machine-hour basis.
The Board of Directors has decided to calculate the variances for the period to analyze the sales performance of the company.
The following information of actual volumes and selling prices for the three products in the last period was obtained:
Required:
i) Calculate the standard profit per unit.
(3 marks)
ii) Calculate the following variances for overall sales for the last period:
Sales profit margin variance
Sales mix profit variance
Sales quantity profit variance
Sales volume profit variance
(8 marks)
iii) Prepare a statement showing the reconciliation of budgeted profit for the period to actual sales less standard cost
(4 marks)
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a) Pagsana Company plans to introduce a new product line for production of its local drink in Walewale. The company, therefore, decided to acquire either a semi-automated plant or an automated plant. The relevant data for the two proposed plants are as follows:
Required:
i) Select the appropriate plant on the basis of:
(7 marks)
ii) Explain TWO (2) advantages of discounted cashflow method of investment appraisal. (4 marks)
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Good decisions do not only emanate from good decision-makers but also from the quality of information used in the decision-making process.
Required:
Identify FIVE (5) qualities of good management accounting information. (5 marks)
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Graphix Communication Group Limited (GCGL) is a magazine publishing company. It comprises a number of different divisions, each publishing magazines in a different sector. GCGL is now considering publishing Financial Magazine. The Financial Magazine market is very competitive with a number of well-established titles already being published by GCGL’s competitors.
Financial Magazine is a monthly magazine.
GCGL has therefore commissioned an advertising campaign to launch its Financial Magazine. The price of the Financial Magazine has been set at full cost plus a mark-up of 20%.
Forecast variable cost per copy of the Financial Magazine:
Cost Description GH¢
Paper 0.83
Ink See note (i)
Machine cost 0.22
Other variable cost 0.15
The following additional information is available:
i) Each Financial Magazine needs 0.2 litres of ink. However, 10% of the ink input to the printing process is wasted. Ink costs GH¢5.40 per litre.
ii) In month 1, GCGL expects to sell 50,000 copies of the magazine to new customers at this price.
iii) After their first month of sales, GCGL expects 90% of first month’s customers to purchase the Financial Magazine in month 2. After the second month of purchase, GCGL expects to retain 85% of month 2 customers in subsequent months.
iv) As the magazine circulation area increases, sales to additional new customers in month 2 will be 20% of month 1 sales figure. 90% of this would be retained in month 3.
v) Sales to additional new customers in month 3 would be 30% of month 1 sales figures.
vi) Fixed overhead costs are apportioned by GCGL to the Financial Magazines based on first month sales volume. Total budgeted annual fixed overhead is GH¢18,000,000 and total budgeted annual magazine sales, including the Financial Magazine, is 12,000,000 copies.
vii) The sales price of the Financial Magazine will remain unchanged throughout the first three months.
Required:
a) Discuss TWO (2) advantages and TWO (2) disadvantages of the managing director’s pricing strategy in the circumstances described above.
(4 marks)
b) Produce a statement that shows the total profit for the first three months of Financial Magazine.
(10 marks)
c) Calculate the number of copies of the Financial Magazine that need to be sold to achieve a profit of GH¢100,000.
(6 marks)
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The basic objective of an audit is to form and express an opinion on the financial statements. The tangible means by which the auditor achieves this objective is the Auditors Report that is issued to members of the company after the completion of the audit.
Required:
i) Discuss TWO (2) authoritative sources which govern the form and content of the auditor’s report to members. (4 marks)
ii) Explain the essence or importance of Management Responsibility and Auditor’s Responsibility paragraphs in the auditor’s report. (6 marks)
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