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ACCA REVISION MOCK

Accountant in Business

December 2012
Time allowed: 2 hours ALL 50 questions are compulsory and MUST be attempted.

Do not open this paper until instructed by the supervisor. This question paper must not be removed from the examination hall.

REVISION MOCK QUESTIONS

ALL 50 questions are compulsory and MUST be attempted


1 An electronics retailer has decided to hire new staff members in order to deal with an increase in demand for its products. Which level of strategic planning will this most closely relate to? A B C D 2 Strategic Tactical Operational Business (2 marks)

Which of the following is not a stage in the strategic planning process? A B C D Analysis Implementation Design Choice (2 marks)

The following are attributes of either the divisional structure or the functional structure. 1 2 3 4 Economies of scale are encouraged Encourages standardisation of outputs and processes Adaptable if further diversification is pursued Senior managers are able to focus on strategic issues

Which of these are features of the DIVISIONAL structure? A B C D 4 1 and 2 2 and 3 2 and 4 3 and 4 (2 marks)

Which of the following factors could explain why a manager has a wide span of control within an organisation? A B C D Employees are highly skilled and motivated Employees jobs are complex and specialised Employees are widely spread geographically The manager is inexperienced and unskilled (2 marks)

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ACCA F1: ACCOUNTANT IN BUSINESS

At his annual appraisal, J is offered a large pay rise and a new job title. According to Maslow, which part of Js hierarchy of needs is most likely to be met by this offer? A B C D Self-fulfilment Social Safety Ego (2 marks)

Country A is experiencing significant growth in the disposable income of its population. Which type of inflation is this likely to cause? A B C D Cost-push Demand-pull Imported Monetary (2 marks)

Consider the following two statements: 1 Extrinsic rewards are the rewards that arise from the performance of a job itself. They would include a sense of job satisfaction or a feeling of achievement from a job well done. Job enlargement refers to a deliberate and planned process of improving the responsibility, challenge and creativity of a particular job.

Which of these two statements is/are correct? A B C D 8 1 only 2 only Both Neither (2 marks)

Which of the following is NOT one of the fundamental principles of the IFAC code of ethics? A B C D Integrity Confidentiality Openness Objectivity (2 marks)

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REVISION MOCK QUESTIONS

The newly elected government of country H is debating its approach to managing the national economy. The Finance Minister has stated that our economy is growing too quickly. We need to increase the level of taxation and think about reducing the money supply to try and slow the economy down. Which approach to national economic management is the Finance Minister suggesting? A B C D The classical approach The monetarist view Supply-side economics The Keynesian view (2 marks)

10

Accountancy is classed as a profession rather than an occupation. Which of the following is NOT a reason for this? A B C D Accountancy requires a period of training to enable the mastering of specialised skills Accountants are normally highly paid Accountants have to comply with a code of ethics Accountants are governed by one of a number of professional associations (2 marks)

11

Which of the following reasons for a member of staff leaving a business would be classed as avoidable? A B C D Pay disputes Disciplinary action Long-term illness Redundancy (2 marks)

12

Based on staff questionnaires, Manager S has been plotted onto Blake and Moutons managerial grid. She has been told her management style most closely corresponds to task management. Where has she been plotted on the grid? A B C D (9,1) (5,5) (1,9) (9,9) (2 marks)

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ACCA F1: ACCOUNTANT IN BUSINESS

13

Which of the following statements are correct? 1 2 A B C D Adair identified three major areas that leaders need to be able to manage task, group and individual needs. To be successful, he argued that a leader must strive to manage all three areas while maintaining his or her position as an effective leader. 1 only 2 only Both Neither (2 marks)

14

H purchases a new computer system. It allows him to input his personal income for the year, which comes from a number of different sources, and then automatically calculates his personal tax liability. Which type of information system has H purchased? A B C D Management information system Expert system Executive information system Decision support system (2 marks)

15

A product has recently had its selling price raised by 5%. This has lead to a 10% reduction in the number of units sold. Which of the following statements about the product are correct? A B C D It has a price elasticity of demand of 0.5 It is unit elastic It is likely to be classed as a necessity by customers It may have a large number of substitutes (2 marks)

16

Which of the following statements about internal audit are correct? 1 2 3 4 A B C D It is a legal requirement for all companies Its role is to assess whether an organisation has sound internal controls Internal auditors determine the scope of their own work It makes recommendations to managers on internal control and governance 1 and 2 2 and 4 1 and 4 3 and 4 (2 marks)

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REVISION MOCK QUESTIONS

17

Hiram has decided to set up a business offering a range of products designed for customers over the age of 60. He feels that this will allow him to avoid direct competition with other companies and also let him charge his customers a premium for his products. Which of Porters generic strategies is this most consistent with? A B C D No-frills Differentiation Cost leadership Focus (2 marks)

18

X is an accountant is preparing the accounts for GHF Ltd, one of her clients. Last year she convinced several investors to put large amounts of money into GHF, but X has now discovered that the company has seriously underperformed during the last financial year. What ethical threat does this expose X to? A B C D Familiarity Self-interest Intimidation Advocacy (2 marks)

19

S Ltd is a large conglomerate company that operates in a large number of different markets in country V. It is currently investigating the possibility of entering a new market paint manufacturing. However, the CEO of S Ltd is concerned about the proposals. There are currently a number of large paint manufacturers already in the market. Raw materials required for paint manufacturing are plentiful, but paint sales have been falling in country V in recent years, as wallpaper and other forms of wall-covering are becoming more fashionable. In addition, he worries that the set-up costs of the new division will be very high. Which of the following is NOT one of Porters five forces that the CEO of S Ltd is concerned about? A B C D Barriers to entry Substitutes Power of customers Power of suppliers (2 marks)

20

J is part of a team working in company T. She tends to encourage communication between the other members of the group as well as trying to build friendships and relationships between them. Which of Belbins group roles is J filling? A B C D Plant Resource-investigator Team worker Shaper (2 marks)

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ACCA F1: ACCOUNTANT IN BUSINESS

21

Which of the following is not a data security issue? A B C D Theft of business data Corruption of data due to virus infection Unauthorised use of data Destruction of data by fire or flood (2 marks)

22

A team has recently been formed within a business. The members of the team are currently agreeing how the group will be run and how decisions will be made. According to Tuckmans model, what stage of group development has the team reached? A B C D Storming Norming Forming Performing (2 marks)

23

From the following list, which of the following are supra-national sources of legal authority? 1 2 3 4 A B C D United Nations resolutions European Parliament Acts World Trade Organisation Agreements European Court rulings All of them None of them 1, 3 and 4 3 and 4 (2 marks)

24

Country Z is currently experiencing a period of economic contraction, or a bust period. Which type of unemployment is this likely to create? A B C D Frictional Cyclical Structural Real wage (2 marks)

25

With regards to the management accounting function, which of the following statements is correct? A B C D It is often used by external stakeholders, such as shareholders It is a requirement for all limited companies It is mainly a historic record of the organizations activities It aids planning and decision making within the business (2 marks)

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REVISION MOCK QUESTIONS

26

ACCAMAP is a mnemonic for the types of internal control employed by an organisation. Which TWO of the following are types of internal control included in ACCAMAP? 1 2 3 4 A B C D Monitoring Authorisation Performance Physical 1 and 2 1 and 3 2 and 3 2 and 4 (2 marks)

27

Which of the following is not part of the 4Ps of the marketing mix? A B C D Product People Place Price (2 marks)

28

Consider the following statements: 1 2 A Ponzi scheme is a fraudulent investment offer that involves paying abnormally high returns to initial investors out of the new money paid in by subsequent investors. Employees who have any suspicions that they have uncovered money launder ing activities should report them directly to the authorities.

Which of these statements is/are correct? A B C D 29 1 only 2 only Both Neither (2 marks)

K is to be interviewed for a new job. When he arrives, he discovers that he is going to be interviewed by several people at the same time. What type of interview is K being given? A B C D Face-to-face Group Panel Stress (2 marks)

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ACCA F1: ACCOUNTANT IN BUSINESS

30

Which of the following is NOT one of Honey and Mumfords learning styles? A B C D Activism Pragmatism Theorism Imaginism (2 marks)

31

Which of the following statements identifies three broad requisites for fraud? A B C D Collusion, opportunity, motivation Dishonesty, opportunity, motivation Opportunity, collusion, dishonesty Dishonesty, collusion, motivation (2 marks)

32

Which of the following statements is correct regarding non-executive directors? A B C D They should make up at least half of the board of directors in larger companies They help the executive directors with the daily running of the company They may be friends or relatives of the executive directors, as this helps their working relationship Once appointed, they should continue to act as non-executives for as long as possible as this will ensure they are knowledgeable and experienced (2 marks)

33

Which of the following organisations consults with the users of accounts about which accounting standards should be developed? A B C D International Accounting Standards Committee Foundation (IASCF) International Accounting Standards Board (IASB) Standards Advisory Committee (SAC) International Financial Reporting Interpretations Committee (IFRIC) (2 marks)

34

Which of the following functions is most likely to be undertaken in a treasury department? A B C D Preparation of cash flow statements Foreign currency management Product pricing decisions Key factor analysis (2 marks)

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REVISION MOCK QUESTIONS

35

Company G is considering raising finance to invest in new premises. It believes that it should raise debt finance by way of a bank loan. Which of the following statements are correct regarding debt and equity finance? A B C D Interest payments tend to be cheaper than dividends Interest payments can be suspended in the future if H is unable to afford them Dividends are an allowable deduction against Hs profits H will likely need to provide asset security to investors whether it chooses to raise debt or equity finance. (2 marks)

36

Which of the following documents would normally be seen earliest in the sales cycle? A B C D Goods received note Sales invoice Goods despatch note Order confirmation (2 marks)

37

In order t o deal w i t h c om pl ex probl ems, w hi c h of t he f ol l owing m et hods of communication is most likely to be effective? A B C D Wheel Circle Chain All-channel (2 marks)

38

B started a new electronics business many years ago. His business now employs several dozen staff members. B is the sole owner and makes all of the key decisions within the organisation. According to Handy, which cultural type exists in Bs business? A B C D Person Task Power Role (2 marks)

39

Naboo plc is a large company based in country B. It offers its workers a range of flexible benefits, such as additional holiday time and family health insurance. Its employees are well motivated - even though they are not highly paid. According to Hofstede, this would indicate that Bs country is: A B C D Individualistic Feminine Masculine Confucian (2 marks)

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11

ACCA F1: ACCOUNTANT IN BUSINESS

40

If an employee does what a manager asks of them because they wish to imitate or become like their manager, what sort of power does their manager hold over them? A B C D Referent Legitimate Expert Coercive (2 marks)

41

Which of the following is NOT a component of internal control? A B C D The control environment Risk assessment processes Monitoring of controls Preventative actions (2 marks)

42

Businesses may wish to introduce certain key values in order to make it as easy as possible for employees to behave in an ethical manner. Which of the following is one of these key values? A B C D Openness Confidentiality Professional behaviour Integrity (2 marks)

43

JM Ltd is a medium-sized clothing retail chain that has recently undertaken a stakeholder analysis exercise using Mendelows matrix. JM feels that the national government currently has little interest in the company, though the directors feel that it would have significant power should it choose to intervene in the companys affairs. What strategy would Mendelows matrix suggest JM takes with regards to the national government? A B C D Key players Minimal effort Keep satisfied Keep informed (2 marks)

44

Shareholders are likely to be which type of stakeholder? A B C D Interested External Internal Connected (2 marks)

12

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REVISION MOCK QUESTIONS

45

An ACCA qualified accountant is asked by his immediate superior to undertake an activity he feels is unethical. What is the correct order that the following actions should be taken in? 1 2 3 A B C D Contact the ACCA Report to a senior manager in charge of ethics Resign from the post 2, 3, 1 1, 2, 3 2, 1, 3 3, 2, 1 (2 marks)

46

Which of the following is not a common feature of committees? A B C D Decisions tend to be made rapidly Decisions may be compromises rather than the optimal solution Improves co-ordination between work groups Some members of the committee may dominate proceedings (2 marks)

47

Which of the following is a primary activity within Porters value chain? A B C D Marketing and sales Procurement Infrastructure Human resource management (2 marks)

48

Which of the following is not a benefit of having a diverse workforce? A B C D Increased innovation and creativity Broader range of skills Ability to hire best talent from labour pool The company can pay lower wages (2 marks)

49

Omar works in the finance department as a junior accountant. He sends a memorandum to the Marketing Director. Which type of communication is this an example of? A B C D Vertical Lateral Diagonal Horizontal (2 marks)

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13

ACCA F1: ACCOUNTANT IN BUSINESS

50

Hannah has recently started a new job in D plc. To help her, she is being mentored by an experienced member of staff. Which type of learning is Hannah experiencing? A B C D Informal Tacit Formal Incidental (2 marks)

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