1. Al Barari Engineering LLC management have realized the importance of accurate costing and recruited Abdul as their Management Accountant at the beginning of their budgetary cycle.

Instructions

Please help Abdul to reply to the following issues raised by management (5 marks each. Total 15 marks)

1. Two mutually independent capital investments have same NPV. What should they select?
2. There is lot of work involved in separately recording fixed and variable costs. Why is Abdul requesting the company to do all this work?

Al Barari management are unhappy their managers are unable to deliver on budgets handed down to them. What could be the possible reasons?