Show working out and explanation 4.Emma Wang is a project manager at Big Rocks Ltd and is responsible for a global project with a team consisting of people from China, Chile, Russia and Australia. Stacy is keen to build a successful team and wants to prevent any cross-cultural misunderstandings when working and communicating on this project. Read and understand the above statement and select below a strategy that is most likely to lead to success and prevent misunderstandings due to cross-cultural differences. i As communication habits differ significantly across the four cultures mentioned, communication should be limited to using English verbal language. The nonverbal dimension simply bears too many risks and native languages too difficult in translation ii Emma should keep in mind that some cultures are developed, others are less developed. Some have more values, and some have less values. She should consequently avoid choosing members from countries with cultures that are not similar to her own iii Emma should use all communication methods available that are suitable for the team and follow up in writing when communicating verbally. Cultural and individual diversity may help project teams in solving unforeseen problems, during the course of the project iv Cultural dilemmas can prevent any project from being successful. They should therefore be smoothed or suppressed so as to make sure that they cannot disrupt project work. Emma's efforts should concentrate on communication that can help reach that goal 8.Nexus Services, a Sydney based company, is moving its customer support operations to the Philippines. The operations will be locally managed by a subsidiary company. Read and understand best move of this company from the list below. I. Relocation ii. Offshoring iii. Outsourcing iv. Outsourcing offshore 9.Read and understand select which of the following statements below is not correct. i In a positive sense, the risk-return trade-off is that risks need to be taken in order to take advantage of opportunities for the organisation ii One of the key roles of the Board in determining corporate strategy is to articulate the risk/return trade-off and the organisation's risk appetite iii The ASX Corporate Governance Council holds the view that good corporate governance will promote investor confidence, but it cautions that this confidence is not directly related to the ability of entities listed on the ASX to compete for capital iv Performance is the need to take risks to achieve objectives and, to achieve these objectives, risk management needs to be integrated throughout the organisation 10.Read and understand the appropriate descriptions of the qualities of management accounting information. 11.In the past Hill Ltd has carried on its business using a relevant responsibility accounting system for its management accounting needs. Recent changes in strategic approaches within Hill have caused Sheila, Hill's recently employed "strategic management accountant", to recommend important changes to management accounting approaches. Read and understand which of the following statements below, if they had been made by Sheila, would be regarded as correct statements and also valid reasons for making changes in Hill's management accounting approaches. I Hill has set about attracting and developing highly skilled staff as part of its strategy of reducing internal bureaucracy. This involves transferring and delegating authority to lower levels of the organisation and then motivating performance. II Hill needs to identify its relevant cost centres, revenue centres and performance measurement based on increasing revenues within its existing profit centres and investment centres. III Hill will look consistently to its 'final product'. To achieve this, it seeks better understanding regarding not only departmental activity but activities and processes that flow across its renewed value chain. IV Hill is outsourcing non-strategic and non-core activities so that responsibilities and difficulties involved in these activities are borne by parties external to Hill. This is being done so that Hill's value chain is no longer affected by these less important activities. 12.At a senior management meeting of Battery Ltd, one of the managers made the following four statements in relation to 'product life cycle and some aspects of this life cycle'. The manager also made a statement about a new product in Battery's portfolio of products. Read and understand to evaluate the four statements and identify those that are correct: I "Introduction: Development, marketing and production are costs high. Sales volumes are low. To overcome these problems, it is important to establish a temporary monopoly so as to allow a 'penetration pricing' strategy." II "Growth: Sales volumes accelerate, and profits accelerate at the same rate as sales growth. New competitors may enter the market. If entry to the market is expensive (for competitors), the growth stage can see a strengthening of an organisation's competitive position." III "Maturity: Cash cows can be considered as mature products that hold a high-market share in a low-growth market. Due to the low market growth, we now need to continue investing in those products. The positive cash flows produced help to support the necessary development of our future portfolio of products." IV "Our newly introduced product has accelerating sales volume, but it is in in a low growth market. That means the product is a currently a 'question mark' in our portfolio of products and we hope it will not soon enter the 'decline' stage of its product life cycle." 13.Mark Cavendish belongs to an organisation wherein there is a large staff of middle managers between the CEO and the front line. Lines of authority branch outward from the top down like a tree's roots. Individual vice-presidents direct the activities of the staff below them according to specific lines of business and the responsibilities of managers are clearly defined along functional lines. Read and understand which type of business structure Mark belongs to from the list below: i Vertical management ii Layered management iii Horizontal management iv Activity based management 14.Read and understand which of the following statements are correct from the list below: You can select more than one. i The primary objective of a firm's management is to increase the firm's value ii The management accounting system needs to accumulate information from both internal and external sources iii Managers may be faced with a conflict between increasing customer value and increasing shareholder value iv All the given statements are correct 19.Read and understand the statements below select/identify which are true in relation to the analysis of stakeholders: I Stakeholders can influence an organisation's strategy. II The expectations of stakeholders need to be identified. III A balanced scorecard approach can be used to measure performance against stakeholder required outcomes. IV It is likely that there will be agreement over strategic issues if stakeholder and organisational values are the same. V All stakeholders should be treated equally. 20.Read and understand the statements below and identify/select which of them are in line/relation to the "rational" approach to strategy. I The rational approach involves defining the organisation's purpose, undertaking internal and external analysis, making choices based on this analysis and implementing the chosen strategy. II It is based on military traditions and principles. III It requires a bottom-up approach to ensure people feel empowered. IV Strategic choices are more likely to be made on an incremental basis. V The strategic process is more likely to be planned, sequential and orderly rather than a fragmented and incremental process. 21.Read and understand which of the following statements below are true in relation to the term "economies of scale." I. Economies of scale normally requires large capital investment. Diseconomies of scale occur whenever a new product enters the market. III. The introduction of a new supplier generally encourages economies of scale. IV. Achieving economies of scale reduces the risk of new entrants. V. Economies of scale are important for companies following a cost leadership strategy. 22.Read and understand what a company would choose a strategy in which relates as "being all things to all people" is representative of. 23.Read and understand which of the following listed below is not true in relation to the 'value of strategic thinking and planning' within an organisation? I To provide a language and a means of thinking and analysis for working through complex strategic issues. II Helps to clarify and communicate strategy through the organization. III Provides a framework and a roadmap for action based agreed strategic intent and organizational values. IV Harnesses the drive of an organization behind a considered and well communicated strategic direction. V Enables an organization to be proactive in positioning and re-positioning itself in a changing marketplace. 24.Read and understand which of the below statements are true? I To create effective strategy, strategic thinkers need to have linear thinking, rigid processes and established routines. II Two capabilities critical for continuous improvement are innovation and strong values. III Values are important in developing existing strategy, in implementing it and in constraining future strategy development options. IV Rational strategy is often the same as the actual strategy followed by an organisation. V Planned strategy needs to be flexible and opportunistic so that it goes with the flow. 26.ACTIVE Medical is a manufacturer of crutches and wheelchairs. It currently holds 25%share in crutches and 10% in wheelchairs. Market growth is 6% for crutches and 20% in wheelchairs. Read and understand the above statement and select a best option below that describes Bishop Medical's portfolio. i Crutches = Cash Cow; Wheelchairs = Question Mark ii Crutches = Star; Wheelchairs = Cash Cow iii Crutches = Question Mark; Wheelchairs = Dog iv Crutches = Question Mark; Wheelchairs = Cash Cow 27.Read and understand why is a value chain analysis conducted? 28.Read and understand which of the following would be plotted as a Cash Cow on a BCG matrix? i A company experiencing 50% growth and having 50% market share ii A company experiencing 50% growth and having 5% market share iii A company experiencing 10% growth and 5% market share iv A company experiencing 10% growth and 50% market share 29.CASTCA is a major retailing company like WOLMORT and usually buys materials directly from wholesalers to use it in their sales process. At a recent company meeting, the top management decided that it would stop buying clothing products from wholesalers and directly buy clothing products from the manufacturers. Read and understand above statement and select from below list, correctly depicts the above-mentioned scenario? i Economies of scale ii Supplier power iii Backward integration iv Multi-Channel distribution 31.Alpha Ltd is an automobile company in a high demand market requiring high investment and looking to acquire market share. Cash flow for Alpha ltd. is comparatively low at this stage. Beta Ltd. a competitor is planning to enter same market but hasn't gained hold on the market yet. Read and understand above statement and select from below list the stage of industry lifecycle is Alpha Ltd. falls in. i Growth stage giving more power to customers ii Growth stage giving less power to customers iii Maturity stage with high profitability iv Introduction stage with low investment 34.Read and understand what Operational performance measures for an education institution would include? Select from the list below: I Overall pass rate of students. II % Of enrolment growth year on year. III average cost of course delivery per student. IV variety of courses delivered. 35.A firm using the balanced scorecard has included among its strategies 'to improve bottom-line profit that need to improve working conditions'. Read and understand the statement above and select a best description of the evaluation of the firm's success in implementing the strategy from the list below. i It is impossible to determine whether the strategy has been successful ii The only way to measure success is to survey employees iii A number of performance evaluation measures will need to be put in place, but even with favourable results on those measures, the firm cannot conclude that the profit resulted from the improvement in working conditions iv If managers can observe employees' motivation, they will have a good idea of the success or otherwise of the strategy 36.Read and understand Business Improvements from data analytics are not likely to happen unless which elements are present: Select the right elements from the list below: I. Senior Executives paid large bonuses on the volume of data used in decision making. II. Collection of large volumes of data and appropriate storage. III.A culture of evidence-based decision making. IV.A desire for business improvement. 39.The management accountant at Mella Furniture Makers decides to include the following measures on their balanced scorecard (BSC): customer satisfaction, rework costs, on-time delivery, average shopfloor personnel qualification and sales growth in local markets. Read and understand the above statement and select a right measure for BSC perspective from the list below. i Financial perspective Sales growth in the local markets Internal business process perspective Ontime delivery, customer satisfaction Customer perspective Learning and growth perspective Rework costs, average shopfloor personnel qualification ii Financial perspective Sales growth in the local markets Internal business process perspective Rework costs Customer perspective On-time delivery, customer satisfaction Learning and growth perspective Average shopfloor personnel qualification iii Financial perspective Rework costs Internal business process perspective On-time delivery Customer perspective Sales growth in the local markets, customer satisfaction Learning and growth perspective Average shopfloor personnel qualification iv Financial perspective Sales growth in the local markets; Rework costs Internal business process perspective on time delivery; Average shopfloor personnel qualification 41.Crunchy Audio makes two types of TV wall holders, Standard (S) and Deluxe (D). S sells for $16 each and D sells for $24 each. The variable costs for S is $10 and D is $14.Normally STV Audio sells 5 type S TV wall holders for every 2 type D TV wall holder and this sales mix is expected to continue into the future. Fixed costs are $650 000 per annum. Read and understand the above statement, do the calculation, and select the correct break-even analysis in terms of revenue (Closest to) from the list below? i $1 560 000 ii $1 625 000 iii $1 664 000 iv $1 774 000 42.Continental Can Company Ltd (CCCL) manufactures recyclable soft drink cans. A unit of production is a case of 12 dozen cans. The following standards have been set by the production engineering staff and the management accountant: Direct material $3.12 Quantity 4 kg Price $0.78 per kg Direct labour $4.025 Quantity 0.25 hour Rate $16.10 per hour Actual costs incurred in the production of 50,000 units were as follows: Direct material $170,100 for 210,000 kg Direct labour $210,600 for 13,000 hours All materials were purchased during this time period. Read and understand the above statement, do the calculation, and select the correct Direct Labour efficiency variance from the list below. i 8,500 favourable ii 1,300 unfavourable iii 8,050 unfavourable iv 2,750 favourable 43.Read and understand the list below and select one which is NOT a correct statement with respect to employee empowerment? i Employees can contribute well if they are given control over certain aspects of their work ii Employees are frequently in a position to understand why errors in the production process occur iii Employees better understand customer needs because they have direct contact with them iv Work teams are a useful technique to use in attaining competitor advantage 44.Read and understand the list below and select one which is NOT correctly describe beneficial characteristics expected by an organisation using benchmarking? I Benchmarking can identify why differences in performance exist between the organisation and "best practice". II Benchmarking can enable an organisation to see where its management might be improved relative to competitors' management. III Benchmarking can measure the performance gap between the organisation and its competitors. IV Benchmarking can assess difference in performance with an industry competitor in respect of sales and profits. 45.Read and understand the following statements and select the response(s) that are correct and/or reflect the CPA Study Materials' view correctly. I Some stakeholders are interested in sustainability reporting, but others have little or no interest. Recognising this, boards of directors in Australia often ignore their many direct legal duties to stakeholders over shareholders and instead focus on long term responsibility to the shareholders and the company. II Most companies listed on the ASX now produce a corporate social responsibility (CSR) or sustainability report in which they address issues including sustainability and pollution reduction, and often include performance measures of their effectiveness. III The key issue for effective performance measurement is to understand the organisation's strategy for value creation and to measure the success of its value creation activities. IV Performance measures for financial issues and sustainability issues do not always gain the same exposure and are not always accorded similar importance in annual reports, despite the importance of sustainability. 46.Leebing Limited is an Australian retailer of a wide variety of electrical and electronic goods. Leebing senior management requires a scorecard to measure the performance of its four Australian distribution managers. Distribution managers are expected to arrange the efficient transportation of products for sale by its own retail stores and also transport to customers' homes where customers have purchased large items from Leebing stores or have purchased items on Leebing's website. Leebing's main aim is to create value for its shareholders through its three strategies which are to increase market share, to increase sales in stores and on the web and to provide excellent service to customers. The company has 440 'retail shops' located in major shopping centres across Australia. It has an extensive website. It has four distribution centres located carefully across Australia -with one of the four distribution managers being located at each of these centres. The company manufactures a small number of the products that it sells in Australia, but most products are imported and delivered by shipping container direct to one of the distribution centres. To ensure quality after-sales service that activity is under the control of one manager nationally. As Strategic Management Accountant at Leebing you have been asked to identify which of the following is/are most likely to be success-oriented comments regarding possible approaches proposed for adoption within Leebing? Read and understand the above statement and select from the below list. I Distribution managers will be better motivated by their scorecard if the scorecard measures overall communication relating to customer issues including satisfaction with products purchased and service of defective products. II Store managers will be motivated to make better decisions if they participate in a profit share scheme that identifies the profit of all stores and which then shares that profit among all 440 retail store managers on the basis of sales growth achieved in each store. III To translate strategy into action, measures to include on an individual distribution manager's scorecard would include number of deliveries required each day, number of deliveries achieved per day, average delivery time, number of complaints about late deliveries, average cost per delivery. IV Gaming and/or biasing can be avoided if delivery managers and store managers are given freedom to communicate fully and then to adjust scorecard results relevant to poor performance outcomes. 47.Read and understand which one of the following statements relating to communication within a restaurant is most likely NOT to be correct? i A customer leaving a restaurant who says they were 'satisfied with their evening' will provide a timely and accessible performance measure that can easily lack validity ii Good managers are likely to be unhappy with the feedback (above in A) gathered from customers regarding 'meal satisfaction'; while poor managers are likely to be happy iii Where many customers state that they were satisfied with their meal and say why they were satisfied this will provide increased clarity regarding the meal quality iv When many customers leave the restaurant at the same time and make various comments on their meals the customers' statements will increase information to management in terms of reliability and timeliness 49.Mix and Match Pty Ltd is an ASX listed business. It is considering closing its Australian manufacturing plant and relocating to a country with cheaper labour costs and less government regulation. Stakeholders have been identified by the Management Accountant. These stakeholders have then been assigned into a stakeholder grid. One of the identified stakeholders is "employees who will become redundant and their trade unions". Read and understand the above statement within the stakeholder grid, that this group would have what level of interest and power? Select a right one from the list below: i High Power and high Interest ii High Power low interest iii High Interest and low power iv Low power and low interest 50.JAYJAY Services, a Sydney based company, is moving its customer support operations to India. The operations will be locally managed by a subsidiary company. Read and understand best description of the move. 51.Reciprocal promoting of the brand and uncertainty surrounding the performance of the organisation are benefits and risks of what mode of entry? Read and understand the above statement and select the right mode of entry from the below list. i Joint venture ii Strategic alliance iii Licensing iv Franchising 52.Which one of the following methods of establishing operations would be most appropriate for a company such as Gloria Jeans, the coffee store operator, if it wished to achieve rapid foreign expansion of its business by providing operational assistance to prospective business partners and with only limited capital expenditure? Read and understand the above statement and select the a right one from the below list. i Licensing agreements ii Joint Venture with Starbucks iii Franchising Agreement iv Marketing subsidiaries in other countries 53.Read and understand the list of statements below and select a right one that most likely to be generally correct. i Kaizen is an approach to Strategy that involves minor changes and as such is an appropriate method that can be communicated to all staff in order to seek the ongoing participation of staff at all levels of the organisation ii One aspect of Activity Based Management is referred to as Business Process Management (BPM). BPM is concerned with making incremental improvements to the way business processes are undertaken iii Target costing is a strategic management accounting technique that will help improve product design and/or features, creating the opportunity to increase selling prices so that any 'gap' is minimized iv If pre-production committed costs are very low when compared with overall costs after production commences then the importance of overall Life-Cycle costs as part of Strategic Management becomes relatively more important 54.Read and understand the statements below and select one that is NOT correct. i Business Process Management begins with appreciation of an organisation's strategic position and identifies how business processes can be designed under ideal conditions using the most advanced technology ii Examples of reverse value chain movements include the return of defective raw materials and components to suppliers, or warranty claims made by customers iii Activity Based Management and Activity Based Costing have different objectives, but both are built upon gaining understanding of activities and activity analysis iv When eliminating a non-value adding activity, the cost savings resulting from the elimination must be less than the cost of implementing the activity analysis initiative 55.Read and understand which of the following statements below are correctly identified the issues that arose from or related to outsourcing and/or offshoring? I Outsourcing commonly results in an increased dependence on third parties for the most strategically important functions of an organisation. II Life cycle costs for an outsourced function can be greater than if the function had been retained in-house. III Outsourcing is unlikely to provide a firm with increased flexibility to accommodate changing market conditions. IV Outsourcing can result in service and quality levels being less than would be achieved by internal providers. V Outsourcing can provide greater access to expertise and resources. However long-term dependency on outsourcing can arise. 56.Read and understand the list of statements below and select one that is true for the product life cycle costing approach. i Costs are both committed and incurred over the life of the project ii A committed cost is the same as an incurred cost iii Minority of costs are committed at the time of product design, property manufacture and the construction of production facilities iv Most of the costs are not incurred until later in the life of a project 57.Customer-profitability analysis moves the focus of strategic management accounting to the customer. Understanding an organisation's customers are and what contribution they make to profits is important in determining the strategic approach to adopt in dealing with customers. It is possible to identify a four-way relationship (as in Module 4) between the net margin earned from sales and customer-service costs. Read and understand the statement above and select one from the list below that is NOT correct according to this four-way relationship. i Some customers require suppliers to create specialised capabilities to meet their needs. Such customers are potentially profitable for their supplier in the long term ii Aggressive customers are large and often important customers but the combinations of demands they impose tend to make them 'low profit customers' iii Passive customers are unlikely to be profitable even if they engage in relatively low purchasing activity iv A customer who is inexpensive to service is not always a desirable customer as they will tend to generate low net margins and are thought to be 'prepared to change supplier' solely on the basis of pricing 58.The effectiveness of a JIT system is often facilitated by the elimination of some common forms of internal control. Read and understand the statement above and select one from the list below, the forms of internal control elimination that will usually be acceptable with a JIT system. i Locked doors on production areas ii Two signatures required on large checks iii Preparation of hard copy receiving reports iv Voucher approval, prior to paying accounts payable 59.Read and understand the statement and select one from the list below. Total quality management (TQM) stresses that all operations of an organisation must be focused on improving the reliability of which of the following? i Business models ii Employee practices iii Compensation methods iv Product or service offerings 60.Oration Ltd is a telecommunication manufacturer and supplier. Oration markets its products to customers and includes support services (through one of two enquiry channels) to its customers at no additional cost. The two enquiry channels are by telephone call or online. Therefore, the cost of providing support service has been divided into two cost pools. The cost driver for phone enquiries is the number of calls and the cost driver for online enquiries is the number of emails received. The following budget provides details relating to three of Oration's major customers. Calculate profitability against sales (including support service resources used by each customer) using the figures provided. Customer:R Ltd S Ltd T Ltd Total Sales:$100,000 $120,000 $80,000 $300,000 Cost of goods sold:$ 45,000 $ 40,000 $28,000 $113,000 Support Activities: Phone enquiries150 900 300 1,350 On-line enquiries1,400 600 300 2,300 Cost pools for Support Service Activities: Phone Support enquiries$90,000 On-line Support enquiries$25,000 Your task: Based on your calculations regarding overall customer profitability (as need to be calculated from the above figures), advise Oration by selecting correctly from the available options in MC25 and MC 26: Read and understand the above statement and select correct one from the below list in regard to Oration and its customers. i T Ltd is the best customer with whom Oration deals based on margin as a percentage of sales ii R Ltd is the best customer with whom Oration deals based on margin as a percentage of sales iii Phone enquiries supplied by Oration cost less than $10 each; Online enquiries supplied by Oration cost less than $65 each iv Phone enquiries supplied by Oration cost over $65 each; Online enquiries supplied by Oration cost over $10 each 61.Oration Ltd is a telecommunication manufacturer and supplier. Oration markets its products to customers and includes support services (through one of two enquiry channels) to its customers at no additional cost. The two enquiry channels are by telephone call or online. Therefore, the cost of providing support service has been divided into two cost pools. The cost driver for phone enquiries is the number of calls and the cost driver for online enquiries is the number of emails received. The following budget provides details relating to three of Oration's major customers. Calculate profitability against sales (including support service resources used by each customer) using the figures provided. Customer:R Ltd S Ltd T Ltd Total Sales:$100,000 $120,000 $80,000 $300,000 Cost of goods sold:$ 45,000 $ 40,000 $28,000 $113,000 Support Activities: Phone enquiries150 900 300 1,350 On-line enquiries1,400 600 300 2,300 Cost pools for Support Service Activities: Phone Support enquiries$90,000 On-line Support enquiries$25,000 Your task: Based on your calculations regarding overall customer profitability (as need to be calculated from the above figures), advise Oration by selecting correctly from the available options in MC25 and MC 26: Read and understand the above statement and select correct one from the below list in regard to Oration and its customers. i Overall, S Ltd is the best customer with which to deal as 40% of sales are made to S ii Overall, S Ltd is the first customer with whom discussions should be held to discuss value chain difficulties affecting overall profitability iii Overall, R Ltd is the first customer with whom discussions should be held to discuss value chain difficulties affecting overall profitability iv Overall, T limited is the least profitable company for Oration and T should be advised that Oration is considering deleting T as a customer 62.Bob, Kevin and Stuart are production managers at Gru Seating Pty Ltd (a plant that manufactures seats and associated components for luxury cars). There are three product lines: Bob is in charge of case manufacturing; Kevin is in charge of electrical controls; and Stuart is in charge of assembly. The direct materials and labour costs are traced to each product line. Also, there are indirect manufacturing costs (overhead) that are associated with activities which cannot be traced to a single product, including: materials acquisition; materials storage and handling; product inspection; manufacturing supervision; job scheduling; and equipment maintenance. Gru Seating Pty Ltd charges each of the three production managers a "fair share" of the total indirect cost, using the proportion of units produced in a manager's area, relative to the total units produced. Read and understand the above statement and select a correct one from the below list in regard to best description of methodologies. i Target Costing ii Volume-based Costing iii Activity Based Costing iv Time Based Activity Based Costing 63.Read, understand and select more than one statements from the below list that are most likely to be NOT correct in respect to understandings surrounding the 'Value Chain 'concept. I It is vital that business strategies and value chain configurations are based on the assumption of continuous growth, aiming at economies of scale, rather than being influenced by the business cycle. II Activities that add value comprise those activities that are contained with the boundaries of the specific organisation. III Value chain analysis enables a competitive strategy to be designed by understanding how an organisation's various activities link and interact. IV Creating competitive advantage requires an organisation to understand the industry value chain and not only its horizontal competitive position within the industry 64.Read and understand what Project Management is all about. 65.The project planning stage is where the specific strategy for delivery of the project specifications is developed in detail and tentative dates for deliverables are established. Read and understand the 5 key areas in Project Planning. 66.Read and understand the basic roles and responsibilities of the Management Accountant in Project Selection. 67.Read and understand the project Implementation stage of strategic management programs. Select from the list below the key focus areas. I Change Strategy. II Business impact analysis. III Change readiness. IV Involvement strategies. V People transition and workforce effectiveness. 68.Woolmart is planning to implement a new point of sale system. Estimates of normal times and costs for completing this project are: Activity Description Expected Time Expected Cost: A Obtain approval from the board 12 days $5,000 B Pre-implementation review 25 days $31,000 C Collect relevant data requirements 11 days $23,000 D Establish physical network requirements 23 days $51,000 E Design and implement software 34 days $54,000 F Documentation and training 10 days $15,000 G Post implementations review 14 days $27,000 H Final testing and go live 3 days $9,000 Activity B, C and D can start as soon as approval in Activity A is granted. E can start only after C has been completed. F can start when B has been done. G can start only once D is complete. H can only begin after G and E is complete. Read and understand the above statement and select from the list below on how long it will take to complete the project and at what cost? i 60 days and it will cost $215,000 ii 47 days and it will cost $51,000 iii 52 days and it will cost $92,000 iv 60 days and it will cost $91,000 69.The mayor of MCQ, Queensland, is considering the purchase of a computer system to automate the city's rate collections. The system costs $75,000 and has an estimated life of five years. The mayor estimates the following savings will result if the system is purchased: Year Savings 1 $20,000 2 $25,000 3 $30,000 4 $15,000 5 $12,000 If Smalltown uses a 10 per cent discount rate for capital budgeting decisions. Read and understand the above statement, calculate and select from the list below the net present value of the computer system. i $79,057 ii $11,658 iii $4,057 iv $63,342 70.Read and understand the statements below and select more than one from the list below that correctly describes typical characteristics of projects or are correct observations about projects. I Projects involve a relatively high level of uncertainty. II Projects focus on providing a solution to a problem or satisfying some objective and therefore necessarily involve planning variations in scope in order to achieve the desired outcome. III Project planning commonly allows start and finish times that will vary according to many inevitable changes in the project plan. IV A common feature of projects is that even though they are limited in scope they still use multiple resources and require extensive coordination. 71.Read and understand the statements below and select from the list below which statement is the least accurate in respect of Earned Value. i The Earned Value method is most easily used where a project's starting point can be measured with reasonable accuracy, such as building a highway, dredging a shipping channel or building a multi-level building ii Comparing Earned Value with budgeted costs and with actual costs produces two variances (both measured in units of currency) - the Project Spending Variance and a variance that deals with timing that is called the Project Schedule Variance iii Creation of Indexes from the two variances in B (above) allows comparison of different projects and managers of different projects - even though various projects may be very different in size, cost and timing iv The Earned Value method breaks down the budget variance into two parts. The key factor in this breakdown is the EV or the expected cost of project work completed to date 72.Stacy Wang is a project manager at Big Rocks Ltd and is responsible for a global project with a team consisting of people from China, Chile, Russia and Australia. Stacy is keen to build a successful team and wants to prevent any cross-cultural misunderstandings when working and communicating on this project. Read and understand the above statement and select from the list below the strategy that is most likely to lead to success and prevent misunderstandings due to cross-cultural differences. i As communication habits differ significantly across the four cultures mentioned, communication should be limited to using English verbal language. The nonverbal dimension simply bears too many risks and native languages too difficult in translation ii Stacy should keep in mind that some cultures are developed, others are less developed. Some have more values, and some have less values. She should consequently avoid choosing members from countries with cultures that are not similar to her own iii Stacy should use all communication methods available that are suitable for the team and follow up in writing when communicating verbally. Cultural and individual diversity may help project teams in solving unforeseen problems, during the course of the project iv Cultural dilemmas can prevent any project from being successful. They should therefore be smoothed or suppressed so as to make sure that they cannot disrupt project work. Stacy's efforts should concentrate on communication that can help reach that goal 73.Arvind Ponti's, has been appointed project manager for a consumer products company. The project's task is a relaunch of an established brand. He estimates that the most likely time to finish the project is 24 days (assuming predictable delays and ignoring unlikely scenarios that will either decrease or increase the time). His optimistic prediction for the project is 14 days (assuming that there are none of the usual delays). His pessimistic prediction for the project is 58 days (assuming that all possible delays occur). Read and understand the above statement and select from the list below the expected time for the project. i 20 Days ii 28 Days iii 42 Days iv 50 Days 74.Read and understand the statement and complete it by selecting an appropriate one from the list below. This sentence "The Project Sponsor ...." i Is usually involved in contract negotiation ii Has functional responsibility for project iii Manages the day-to-day project iv Prepares necessary information for decision-making 75.Risk is heightened in projects because of the increased number of unknowns resulting from the fact that projects inevitably have a high degree of novelty or 'newness'. Consider the following ideas that some people have about risk as a concept and its management. Read and understand the above statement and select from the list below the one that correctly be regarded as the least appropriate for successful management of risk in projects. i Project teams have to deal with the concept of 'known risk, when undertaking risk assessment and risk management. It has been recommended that 'unknown risks' should be managed appropriately by good Project Managers and that contingency responses to unknown risks are an important risk management issue ii Risk assessment typically happens prior to project commencement and is about identifying what the risks are and assessing the probability and the financial impact of risk - enabling appropriate planning and strategies. Project Teams need to understand risk whether they are Matrix or Task Force teams iii Good risk management starts when the project commences. It is about the ongoing process of monitoring and managing the risks of the project while it is being implemented and taking action to minimize risks iv Good project management requires the Project Manager and Project Sponsor to plan to include inevitable 'scope creep'. This is because the stakeholders in a project may wish to change project fundamentals as the project proceeds 76.Macquarie Ltd is considering buying new machinery for its manufacturing plant, a Piece X and Machine Y. However, the company can only raise enough funds to proceed with one of them. Investment appraisal techniques were used, and the following results were found: Piece X Machine Y NPV (Net Present Value)$950 000 $468 000 Internal Rate of Return0.14 0.12 Payback Period4.8 years 3.5 years Read and understand the above statement and select from the list below the most logical interpretation of the results? i Piece X should be selected as it gives the highest IRR ii Machine Y should be selected because it has a quicker payback period iii Piece X should be selected because it will yield the highest NPV iv Piece X should be selected as it gives the longest payback period 77.Thermotec is considering buying new machinery for its manufacturing plant, an Extruder And Press B. However, the company can only raise enough funds to proceed with one of them. Investment appraisal techniques were used, and the following results were found: Extruder A NPV $950 000 IRR 0.14 Payback period 4.8 years Press B NPV $468 000 IRR 0.12 Payback period 3.5 years Read and understand the above statement and select from the list below the most logical interpretation of the results? i Extruder A should be selected as it gives the highest IRR ii Press B should be selected because it has a quicker payback period iii Extruder A should be selected because it will yield the highest NPV iv Extruder A should be selected as it gives the longest payback period 78.The managers of the Sydney Seafood Bar (SSB) have decided to use a critical path model to plan the renovation project. The expected times to complete the following activities are as follows: A (7 days), B (10 days), C (14 days), D (7 days), E (11 days), and F (3 days). In addition, Activity A precedes activities B and C; Activity C precedes Activity D; Activity Precedes Activity E; and Activity E precedes Activity F. Read and understand the above statement and select from the list below the expected time taken to complete the entire project? i 31 days ii 28 days iii 3 days iv None of the above 79.Holt Company Ltd determined residual income for the year of $22 000. The company's cost of capital was 12 per cent, the investment turnover was 2.0, and capital invested was$400 000. Read and understand the above statement and select from below list, how much profit was made by Holt Company during the year? i $26 000 ii $48 000 iii $74 000 iv $70 000 80.Rocket Pty Ltd (Rocket) has succeeded in a very competitive market, while many of its rivals have failed. Read and understand the above statement and select from below list that explains the best strategies why Rocket has been so successful. i Rocket has evolved into a multi-divisional organisation ii Rocket has adopted a strategy with a low propensity for risk-taking iii Rocket has adopted more steps to its formal strategic planning process iv The strategies that Rocket pursues, have a strong impact on its performance relative to its rivals