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 P2 Dumps with Practice Exam Questions Answers

Questions: 202 questions

Last Update: Apr 16, 2024

CIMA Certification Exam P2 has been designed to measure your skills in handling the technical tasks mentioned in the certification syllabus

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P2 Questions and Answers

Question # 1

A company's competitor has just launched a rival product at a selling price of $38 per unit. Until now the company's selling price of $41.60 per unit has achieved a 30% mark-up on the product's unit cost. The company proposes to use a target costing approach to pricing to remain competitive.

Management has decided to match the competitor's selling price and has set a target cost to achieve a 20% return on the target price.

What is the cost gap?









Question # 2

In order to support decision making, management accounting information categorizes costs in a variety of ways.

Responsibility accounting primarily distinguishes between costs on the basis that they are either:


sunk or opportunity costs


fixed or variable costs


controllable or uncontrollable costs


relevant or non-relevant costs

Question # 3

Which basis of transfer pricing retains the full autonomy of divisional managers?


Full cost-plus pricing


Variable cost-plus pricing


Negotiated pricing


Market based pricing

Question # 4

Juan is looking to invest in the mining industry. He has narrowed his options down to two rival companies, both with sales of £200m. Company A has an EBIT of £10m whereas Company B has an EBIT of £14m.

This would suggest that Company B is the better investment but Juan is suspicious that Company B has more financial backing than Company A.

Which ratios will tell him which company will use his investment the best?


Profit margin




Current ratio


Quick ratio

Question # 5

Which of the following statements is TRUE about the activity based costing system when compared to absorption costing method?


ABC is easier to administer than an absorption costing system


ABC will be less detailed than an absorption costing system


ABC will provide more accurate overhead allocation than absorption costing


ABC will cost less to administer than an absorption costing system