1. Examine the spreadsheet below

	A	B	C	D
1
2		Q1	2,000
3		Q2
4		Q3	1,500
5		Q4	3,000
6		Total of Q1 to Q4 =:	9,500
7

The formula required in cell C3 to achieve the (absolute value) solution in cell C6 is:

1. =(C2+C3+C4 C6)
2. = 3,000
3. (C6 C2 C4 C5)
4. =(C6/SUM(C2:C4))*-1

2. The present value of 12,000 receivable at the end of each year for 3 years, discounted at 8% is:

1. 48,400
2. 35,265
3. 48,000
4. 30,925

3. Which ONE of the following statements is TRUE?

1. Sales ledger history and aged analyses will increase the average debtors repayment period and increase the total amount of cash received.
2. Increasing the credit limit of customers will encourage early settlement and, hence, reduce sales volumes.
3. Offering early settlement discounts to customers may increase demand but will increase the requirement for sales ledger monitoring.
4. A benefit of offering early settlement discounts to customers is increased the cash inflows provided by cash discounts allowed.

4. Examine the Miller-Orr cash management model shown below

The optimum value of short-term liquid securities to sell is:

1. 5,000
2. 17,400
3. 11,600
4. 4,400

5. Which of the following statements provides the most accurate definition of an activity-based costing system:

1. Has all but rendered the traditional absorption costing system redundant throughout the modern trading (and management) environment
2. Is a useful tool through which executive managers to select the costing system (e.g. ABC, marginal or absorption) that produces the lowest cost
3. Represents an alternative (or complimentary) costing system claiming to provide more accurate product costs and management information
4. Is a management representation of the dynamic commercial (trading) environment that is currently evident throughout northern Europe and the USA

6. Where a business uses a process costing system, the valuation of normal losses, where such losses have no re-sales value, is:

1. An estimated nominal value (e.g. 2 per kilo)
2. The unit value of good production
3. Cost plus recoverable value
4. Nil

7. The net present value of a capital investment project was established at 3,600 (positive NPV) using an 8% discount factor. With a 12% discount factor, the same projects net present value was 6,000 (negative NPV). The projects internal rate of return (IRR) therefore, is:

a. 9.50%

b. 10.00%

c. 9.00%

d. 10.50%