Question 1

A co league claims that morality is usually perceived and interpreted differently by different people so there is no method to judge whether one decision is better than another. This is commonly referred to as

Options :

A : ethical relativity

B : moral philosophy

C : comparative ethics

D : moral relativism

Answer: D

Question 2

Plenary Inc specializes in overnight package delivery. Total packages delivered last year were 10 000.000. and this quantity is expected to remain unchanged in the coming year. Unit contribution margin is $4,50 and total fixed costs are S40.000,000. The firm's 300 delivery truck drivers are seeking a S10 000 raise in annual salary In addition to a current base salary of $45 000 per year, the drivers receive a commission of $0 50 per package delivered If the firm grants the $10,000 salary increase to each driver and seeks to maintain the same level of pre-tax operating profit what is the maximum amount of commission the firm can pay its drivers per package delivered?

Options :

A : $0.0

B : $0.20

C : $0.30

D : $0.35

Answer: B

Question 3

Southwest Supplies Inc. (SSI) is considering the following two projects with cash-flows discounted at SSI's weighted average cost of capital.

CMA-Strategic-Financial-Management-page49-image10

SSI can only afford to invest in one of the projects. Which statement would most likely explain why SSI would choose Project B over project A?

Options :

A : Project B results in a higher cumulative accounting income

B : Project B generates significantly more non-cash expenses

C : Project B cash-flows are relatively more certain

D : Project B cash-flows are to be received sooner

Answer: D

Question 4

Custom Ceramics produces two hand-painted items a large bowl and a large platter. Relevant information for each of these items is shown below

Options :

A : The company should produce only bowls because the contribution margin per bowl is higher.

B : The company should produce only platters because the variable cost per platter is lower

C : The company should produce only bowls because the sales price per Bowl is higher

D : The company should produce only platters because the contribution margin per painting hour is higher

Answer: D

Question 5

Marsalls Products Inc. manufactures and sells two products CD-ROMs and DVD's. The latest forecast on me

products and their costs tor the coming year is shown in the following table.

Note 1: Fixed manufacturing cost of Si.500 000 per year is allocated to products based on the number of

machine hours required to produce the product at a rate of S3 per machine hour

The Manufacturing Team leader just informed the CEO that a fire occurred at one of the manufacturing lines

and that line would be unavailable for the next 12 months. The result is that mere will only be 400 000

machine Hours available The CEO requested the management team to revise the plan for the coming year

based on the new constraint. The Marketing Team leader stated that in order to minimize customer complaints

about the shortage, a minimum of 100,000 units of each product should be produced With the new information

from the Manufacturing and Marketing teams what is the optimal product mix for the coming 12 months''

Assume Marsalls can sell allot its production.

Options :

A : 100,000 CD-ROM-s and 150,000 DVD'[s

B : 120.000 CD-ROM-s 140,000 DVD.

C : 150.000 CD-ROMS and 125.000 DVD

D : 200,000 CD-ROm-s a dn 100,000 DVD

Answer: D