QUESTION 2(8 MARKS)

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For each of the following questions below select the most correct answer and present your answer in your submission in this format: 2.1. a

2.1. Which one of the following options is a reason why a company would

need cash on hand? (2)

a)Giving customers change from sales transactions

b)Buying supplies

c)Paying creditors and other expenses

d)All of the above

2.2 Which one of the following options are examples of cash inflows? (2)

a)Cash sales

b)Receipts from debtors

c)Interest received

d)All of the above

2.3 Which of the below options is not part of cash outflows? (2)

a)Tax payments

b)Rent payments

c)Depreciation expense

d)Purchase of fixed assets

2.4 Which one of the following options may be the result of a business's cash

budget at the end of a given period? (2)

a)Cash surplus

b)Cash deficit

c)Net profit

d)Assessed loss

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QUESTION 3(10 MARKS)

For each of the following questions below select the most correct answer and

present in this format 3.1. a

3.1 Risk is measured using .....? (2)

a)Variance and standard deviation

b)Co-variance and correlation co-efficient

c)Variance and co-variance

d)Standard deviation and correlation co-efficient

3.2 Which calculation is used to measure the extent to which the returns of a

security in a portfolio move together? (2)

a)Co-variance and correlation co-efficient

b)Co-efficient of variation

c)Variance

d)None of the above

3.3 Which of the following statements is correct? (2) i Securities in the same industries tend to be positively correlated. ii Securities in the same industries tend to be negatively correlated. iii Securities in different industries tend to be positively correlated. iv Securities in different industries tend to be negatively correlated.

a) i and iii

b)i and iv

c)Both a and b

d)Neither a nor b

3.4 Which of the following are examples of non-systematic risks for a company

that manufactures consumable goods? (2) i The inflation rate spikes nationwide.

iiAn unexpected terrorist event occurs.

iiiThe price of maize suddenly spikes.

ivTaxes on sugar are increased.

a) Statements (i) and (iii)

b) Statements (iii) and (iv)

c)Statements (i) and (ii)

d)Statements (ii) and (iii)

3.5 What kind of risk can never be totally eliminated, irrespective of the size of the

portfolio? (2)

a)Company-specific

b)Systematic

c)Non-systematic

d)Diversifiable

Question 4(10 MARKS)

For each of the following questions below select the most correct answer and

present in this format 4.1 a

4.1Which of the following assumptions does not pertain to cost-volume-profit

analysis?(1)

a.The units produced will equal the units sold

b.Inventories are constant

c.All costs are classified as fixed or variable

d.Sales mix may vary during the related period

4.2Which of the following is usually prepared before the production budget?(1)

a.Direct material purchases budget

b.Direct labour budget

c.Sales budget

d.Cash budget

4.3 Brown Ltd. has budgeted for annual fixed manufacturing overheads of R60 000for the coming year. Budgeted variable overhead is R0.10 per unit. For the nextquarter, Brown plans to manufacture 500 000 units. Brown's budgeted total

overhead for the quarter is: (3) a.R50 000

b.R65 000

c.R110 000

d.R290 000

4.4For better control of direct material prices, when should the direct material price

variance be recognised?(1)

a.When material is purchased

b.When material is issued from the storeroom

c.When material is put into production

d.When production is completed

4.5Labour efficiency variances may be caused by(2)

a.The use of highly skilled workers

b.Frequent machinery breakdowns

c.The use of marginally skilled workers

d.All of the options are causes of labour efficiency variances

4.6Who is responsible for unfavourable labour efficiency variances caused by poor

quality materials?(2)

a.Warehouse manager

b.Production manager

c.Procurement manager

d.General manager