Mock Paper: Financial Management and Analysis

Mock Paper

Contents
Question 1..................................................................................................................................4
1. Calculate the variances from the projected and actual outrun..........................................4s
2. Describe the possible causes of these variances................................................................4
3. Give an overview of the potential commercial effects of such deviations, as well as the
variations' goal.......................................................................................................................5
4. Strategies for reducing such disparities, as well as suggestions for changing the current
costing model.........................................................................................................................5
5. Give the advantages of zero – based budgeting over incremental based budgeting..........5
Question 2: Watson C. Ltd.........................................................................................................6
1. Compute the gross and net profit of Watson Co. Ltd........................................................6
2. Reasons of declining profit and increasing cash flow problems........................................6
3. Compute Gross profit and Net Profit Margin, by explaining that why these ratios are
significant for analyses of profitability..................................................................................6
4. Recommendations of improving the financial performance..............................................7
Question 3: Biker Corporation...................................................................................................8
1. Compute Breakeven point using the method of net contribution for the production of
‘Fast and Furious’..................................................................................................................8
2. How can a break-even point study assist a business in determining profitable sales
revenue goals?........................................................................................................................8
3. Explain the pros and cons of Activity Based Costing and give some recommendation to
the directors of Biker Corporation Also give an explanation of how moving to ABC could
help the organisation maintain profitability...........................................................................8
REFERENCES.........................................................................................................................10