BPP House 142-144 Uxbridge Road London W12 8AA United Kingdom T 0845 075 1100 (UK) T +44 (0)20 8740 2211 (Overseas) E Learningmedia@bpp.com bpp.com/learningmedia June 2014 £18.00 • Banks of questions on every syllabus area • Answers with detailed guidance on approaching questions • Three mock exams with full answers and guidance For exams up to June 2015 Contact us One of a suite of products supporting Paper F5 Performance Management, for use independently or as part of a package, this Kit is targeted at ACCA’s exams up to June 2015 and contains: Practice & Revision Kit Paper F5 Performance Management This Kit provides material specifically for the practice and revision stage of your studies for Paper F5 Performance Management that has been comprehensively reviewed by the ACCA examining team This unique review ensures that the questions, solutions and guidance provide the best and most effective resource for practising and revising for the exam Performance Management BPP Learning Media is dedicated to supporting aspiring business professionals with top-quality learning material as they study for demanding professional exams, often whilst working full time BPP Learning Media’s commitment to student success is shown by our record of quality, innovation and market leadership in paper-based and e-learning materials BPP Learning Media’s study materials are written by professionally qualified specialists who know from personal experience the importance of top-quality materials for exam success ACCA F5 ACCA approved content provider BPP House 142-144 Uxbridge Road London W12 8AA United Kingdom T 0845 075 1100 (UK) T +44 (0)20 8740 2211 (Overseas) E Learningmedia@bpp.com bpp.com/learningmedia • Banks of questions on every syllabus area • Answers with detailed guidance on approaching questions • Three mock exams with full answers and guidance For exams up to June 2015 Contact us One of a suite of products supporting Paper F5 Performance Management, for use independently or as part of a package, this Kit is targeted at ACCA’s exams up to June 2015 and contains: Practice & Revision Kit Paper F5 Performance Management This Kit provides material specifically for the practice and revision stage of your studies for Paper F5 Performance Management that has been comprehensively reviewed by the ACCA examining team This unique review ensures that the questions, solutions and guidance provide the best and most effective resource for practising and revising for the exam Performance Management BPP Learning Media is dedicated to supporting aspiring business professionals with top-quality learning material as they study for demanding professional exams, often whilst working full time BPP Learning Media’s commitment to student success is shown by our record of quality, innovation and market leadership in paper-based and e-learning materials BPP Learning Media’s study materials are written by professionally qualified specialists who know from personal experience the importance of top-quality materials for exam success ACCA F5 ACCA approved content provider ACCA APPROVED CONTENT PROVIDER ACCA Approved Practice & Revision Kit Paper F5 Performance Management Practice & Revision Kit for exams up to June 2015 Free access to our Exam Success site Look inside June 2014 £18.00 ACF5RK14 (HO).indd 1-3 30/05/2014 16:12 PAPER F5 PERFORMANCE MANAGEMENT BPP Learning Media is an ACCA Approved Learning Partner – content for the ACCA qualification This means we work closely with ACCA to ensure our products fully prepare you for your ACCA exams In this Practice and Revision Kit, which has been reviewed by the ACCA examination team, we: Discuss the best strategies for revising and taking your ACCA exams Ensure you are well prepared for your exam Provide you with lots of great guidance on tackling questions Provide you with three mock exams Provide ACCA exam answers as well as our own for selected questions Our Passcard and i-pass products also support this paper FOR EXAMS UP TO JUNE 2015 P R A C T I C E & R E V I S I O N K I T First edition 2008 Eighth edition June 2014 ISBN 9781 4727 1102 (previous ISBN 9781 4453 7994 4) e-ISBN 9781 4727 1166 British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library Published by BPP Learning Media Ltd BPP House, Aldine Place London W12 8AA All our rights reserved No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of BPP Learning Media Ltd We are grateful to the Association of Chartered Certified Accountants for permission to reproduce past examination questions The suggested solutions in the practice answer bank have been prepared by BPP Learning Media Ltd, except where otherwise stated www.bpp.com/learningmedia Printed in the United Kingdom by RICOH UK Limited Unit Wells Place Merstham RH1 3LG Your learning materials, published by BPP Learning Media Ltd, are printed on paper obtained from traceable sustainable sources ii © BPP Learning Media Ltd 2014 Contents Page Finding questions Question index v Topic index viii Helping you with your revision ix Revising F5 Topics to revise x Question practice x Passing the F5 exam xi Exam formulae xiii Exam information xiv Useful websites xv Questions and answers Questions Answers 111 Exam practice Mock exam Questions 283 Plan of attack .293 Answers .295 Mock exam Questions 309 Plan of attack .321 Answers .323 Mock exam (Specimen paper) Questions 335 Plan of attack .345 Answers .347 ACCA examiner's answers Specimen paper 361 Review Form iii A note about copyright Dear Customer What does the little © mean and why does it matter? Your market-leading BPP books, course materials and e-learning materials not write and update themselves People write them: on their own behalf or as employees of an organisation that invests in this activity Copyright law protects their livelihoods It does so by creating rights over the use of the content Breach of copyright is a form of theft – as well as being a criminal offence in some jurisdictions, it is potentially a serious breach of professional ethics With current technology, things might seem a bit hazy but, basically, without the express permission of BPP Learning Media: Photocopying our materials is a breach of copyright Scanning, ripcasting or conversion of our digital materials into different file formats, uploading them to Facebook or emailing them to your friends is a breach of copyright You can, of course, sell your books, in the form in which you have bought them – once you have finished with them (Is this fair to your fellow students? We update for a reason.) Please note the e-products are sold on a single user licence basis: we not supply ‘unlock’ codes to people who have bought them second-hand And what about outside the UK? BPP Learning Media strives to make our materials available at prices students can afford by local printing arrangements, pricing policies and partnerships which are clearly listed on our website A tiny minority ignore this and indulge in criminal activity by illegally photocopying our material or supporting organisations that If they act illegally and unethically in one area, can you really trust them? iv Finding questions Question index The headings in this checklist/index indicate the main topics of questions, but questions often cover several different topics Questions set under the old syllabus Financial Management and Control and Performance Management papers are included because their style and content are similar to those which appear in the F5 exam The questions have been amended to reflect the current exam format Time Page number Marks allocation Mins Question Answer MCQ bank – Specialist cost and management accounting techniques 20 36 111 MCQ bank – Specialist cost and management accounting techniques 20 36 112 MCQ bank – Specialist cost and management accounting techniques 20 36 113 MCQ bank – Specialist cost and management accounting techniques 20 36 10 114 MCQ bank – Specialist cost and management accounting techniques 20 36 12 116 Linacre Co (12/05 amended) 10 18 15 117 Jola Publishing Co (6/08 amended) 10 18 15 118 The Gadget Co (12/10 amended) 10 18 16 120 Target costing (6/12 amended) 10 18 17 122 10 UHS (6/12 amended) 10 18 17 123 11 Fit Co (12/11 amended) 10 18 18 124 12 Cam Co (6/13 amended) 10 18 18 126 13 Sapu 10 18 19 127 14 Environmental 10 18 20 129 15 Yam Co (6/09 amended) 10 18 20 130 16 Thin Co (6/11 amended) 10 18 21 132 17 Solar Systems (12/13 amended) 10 18 22 134 18 MCQ bank – Decision-making techniques 20 36 23 135 19 MCQ bank – Decision-making techniques 20 36 25 137 20 MCQ bank – Decision-making techniques 20 36 28 139 21 MCQ bank – Decision-making techniques 20 36 30 140 22 MCQ bank – Decision-making techniques 20 36 33 142 23 MCQ bank – Decision-making techniques 20 36 36 144 24 Devine Desserts 10 18 38 145 25 Cut and Stitch (6/10 amended) 10 18 39 147 26 RB Co 10 18 40 148 Part A: Specialist cost and management accounting techniques Part B: Decision-making techniques Finding questions v Time Page number Marks allocation Mins Question Answer 27 Heat Co (6/11 amended) 10 18 41 150 28 Ennerdale 10 18 42 152 29 Hair (12/12 amended) 15 27 42 154 30 Higgins Co (6/08 amended) 15 27 43 156 31 The Cosmetic Co (12/10 amended) 15 27 44 160 32 T Co (12/11 amended) 15 27 44 164 33 Robber Co (6/12 amended) 15 27 45 166 34 Stay Clean (12/09 amended) 15 27 46 168 35 Bits and Pieces (6/09 amended) 15 27 48 170 36 BDU Co 15 27 48 172 37 Gym Bunnies (6/13 amended) 15 27 49 173 38 SH (12/08 amended) 15 27 50 176 39 MCQ bank – Budgeting and control 20 36 51 177 40 MCQ bank – Budgeting and control 20 36 53 179 41 MCQ bank – Budgeting and control 20 36 56 180 42 MCQ bank – Budgeting and control 20 36 58 182 43 MCQ bank – Budgeting and control 20 36 60 183 44 MCQ bank – Budgeting and control 20 36 63 184 45 GH Consultancy 10 18 65 186 46 Sauce Co (6/12 / 12/09 amended) 10 18 65 187 47 Wargrin (12/08 amended) 10 18 66 188 48 Learning (12/11 amended) 10 18 66 189 49 HC (12/08 amended) 10 18 66 191 50 Mic Co (12/13 amended) 10 18 67 192 51 Lock Co (6/12 amended) 10 18 68 194 52 Standard costing and TQM (6/12 amended) 10 18 68 196 53 Choc Co (12/11 amended) 10 18 68 197 54 DIY 10 18 69 199 55 PC Co (12/11 amended) 15 27 69 200 56 ZBB (12/10 amended) 15 27 69 203 57 Northland (6/09 amended) 15 27 70 205 58 Big Cheese Chairs (12/09 amended) 15 27 71 206 59 Designit (12/12 amended) 15 27 71 208 60 Newtown School (6/13 amended) 15 27 72 210 61 Spike Limited (12/07 amended) 15 27 73 212 62 Crumbly Cakes (6/09 amended) 15 27 74 214 63 Secure Net (12/09 amended) 15 27 75 216 64 Carad Co (12/10 amended) 15 27 76 218 Part C: Budgeting and control vi Finding questions Time Page number Marks allocation Mins Question Answer 65 Noble (6/11 amended) 15 27 76 220 66 Block Company (6/13 amended) 15 27 77 222 67 Bedco (12/13 amended) 15 27 78 225 68 MCQ bank – Performance measurement and control 20 36 79 227 69 MCQ bank – Performance measurement and control 20 36 81 228 70 MCQ bank – Performance measurement and control 20 36 83 229 71 MCQ bank – Performance measurement and control 20 36 85 230 72 MCQ bank – Performance measurement and control 20 36 87 231 73 ERP 10 18 90 232 74 ICE 10 18 91 234 75 Biscuits and Cakes Part (6/12 amended) 10 18 91 235 76 Biscuits and Cakes Part (6/12 amended) 10 18 92 237 77 Brash Co (6/11 amended) 10 18 92 238 78 Brace Co (6/11 amended) 10 18 93 240 79 Wash Co (12/12 amended) 10 18 93 241 80 PC (12/08 amended) 10 18 94 243 81 Story 15 27 94 245 82 Viga 15 27 95 246 83 Lewisville 15 27 96 249 84 Heighway 15 27 97 250 85 Web Co (12/12 amended) 15 27 98 252 86 Bath Co (12/11 amended) 15 27 98 254 87 Process Co (12/13 amended) 15 27 99 256 88 Hammer (6/10) 15 27 100 258 89 Woodside (6/07 amended) 15 27 101 260 90 PAF Co (12/13 amended) 15 27 101 262 91 Ties Only Limited (12/07 amended) 15 27 102 264 92 Squarize (06/13 amended) 15 27 103 266 93 Jump (6/10 amended) 15 27 104 268 94 The Accountancy Teaching Co (12/10 amended) 15 27 104 270 95 Bridgewater Co (6/08 amended) 15 27 106 274 96 Oliver's Salon (6/09 amended) 15 27 107 276 Part D: Performance measurement and control Mock exam Mock exam Mock exam (Specimen paper) Finding questions vii Topic index Listed below are the key Paper F5 syllabus topics and the numbers of the questions in this Kit covering those topics If you need to concentrate your practice and revision on certain topics or if you want to attempt all available questions that refer to a particular subject, you will find this index useful Syllabus topic Question numbers Activity based costing 6, 7, 8, 79, Mock Q1, Mock Q3 Balanced Scorecard 77, 92 Behavioural aspects of standard costing 62, 63 Budgetary systems and types 45, 47, 56, 57, 59, 60, 65 Budgeting objectives 46, 55 Cost volume profit (CVP) analysis 24, 29 Decision rules 36, 37, 38, Mock Q2 Decision trees 37 Environmental accounting 14 Expected values 36, 37, 57 Financial performance analysis 83, 84, 85, 89, 90, 91, 93, 94, 95, 96, Mock Q4 Flexible budgets 65 Further processing decision 28, 87 Information systems 73, 74, 81, 82 Learning curve 48, 49, 50, 58, Mock Q2 Life cycle costing 11, 12 Linear programming 25, 30, 31, Mock Q4 Make-or-buy decisions 33, Mock Q3 Material mix and yield variances 53, 54, 62, Mock Q5 Non-financial performance indicators 83, 84, 85, 91, 93, 94, 96 Outsourcing: see make-or-buy decisions viii Performance management information systems 81, 82 Planning and operational variances 63, 64, 66, 67, Mock Q5, Mock Q4, Mock Q5 Pricing decisions 26, 27, Mock Q2, Mock Q3 Relevant costs 28, 32, 33, 34, 35 Return on investment and residual income 75, 76, 78, 80, Mock Q3, Mock Q5, Mock Q1 Sales mix and quantity variances 51, 61, 64, 65, Mock Q5 Standard costs 52, Mock Q4 Target costing 9, 10, 13, Mock Q1 Throughput accounting 15, 16, 17, Mock Q2 Transfer pricing 79, 86, 87, 88 Finding questions Notes Notes Notes Notes Notes Notes Notes Notes Notes Notes Notes Notes Notes Review Form – Paper F5 Performance Management (06/14) Name: Address: How have you used this Kit? (Tick one box only) During the past six months you recall seeing/receiving any of the following? (Tick as many boxes as are relevant) Home study (book only) On a course: college Our advertisement in Student Accountant With 'correspondence' package Our advertisement in Pass Other Our advertisement in PQ Our brochure with a letter through the post Why did you decide to purchase this Kit? (Tick one box only) Our website www.bpp.com Which (if any) aspects of our advertising you find useful? (Tick as many boxes as are relevant) Have used the complementary Study text Have used other BPP products in the past Recommendation by friend/colleague Prices and publication dates of new editions Recommendation by a lecturer at college Information on product content Saw advertising Facility to order books off-the-page Other None of the above Which BPP products have you used? Text Passcards Kit i-Pass Home Study Package Your ratings, comments and suggestions would be appreciated on the following areas Very useful Useful Not useful Good Adequate Poor Yes No Passing F5 Questions Top Tips etc in answers Content and structure of answers Mock exam answers Overall opinion of this Kit Excellent Do you intend to continue using BPP products? The BPP Learning Media ACCA Range Manager of this edition can be emailed at: pippariley@bpp.com Please return this form to: Pippa Riley, ACCA Range Manager, BPP Learning Media Ltd, FREEPOST, London, W12 8AA Review Form (continued) TELL US WHAT YOU THINK Please note any further comments and suggestions/errors below [...]... your revision BPP Learning Media – Approved Learning Partner – content As ACCA s Approved Learning Partner – content, BPP Learning Media gives you the opportunity to use exam team reviewed revision materials By incorporating the examination team’s comments and suggestions regarding syllabus coverage, the BPP Learning Media Practice and Revision Kit provides excellent, ACCA- approved support for your revision. .. App www .bpp. com Our website provides information about BPP products and services, with a link to the ACCA website Revising F5 xv xvi Revising F5 Questions 1 2 SPECIALIST COST AND MANAGEMENT ACCOUNTING TECHNIQUES Questions 1 to 17 cover Specialist cost and management accounting techniques, the subject of Part A of the BPP Study Text for Paper F5 Question 1 1.1 The following statements have been made... Tackling revision and the exam Using feedback obtained from the ACCA exam team review: We look at the dos and don’ts of revising for, and taking, ACCA exams We focus on Paper F5; we discuss revising the syllabus, what to do (and what not to do) in the exam, how to approach different types of question and ways of obtaining easy marks Selecting questions We provide signposts to help you plan your revision. .. Revising F5 Useful websites The websites below provide additional sources of information of relevance to your studies for Performance Management www.accaglobal.com ACCA' s website The students’ section of the website is invaluable for detailed information about the qualification, past issues of Student Accountant (including technical articles) and a free downloadable Student Planner App www .bpp. com... comments from the examiners to show you where students struggled or performed well in the actual exam We refer to the 2014 BPP Study Text (for exams up to June 2015) for detailed coverage of the topics covered in questions In a bank at the end of this Kit we include the official ACCA answers to the Specimen paper Used in conjunction with our answers they provide an indication of all possible points... syllabus coverage of the exam; Mock exam 3 is the Specimen paper Helping you with your revision ix Revising F5 Topics to revise All questions are compulsory so you must revise the whole syllabus Since the exam includes 20 multiple choice questions, you should expect questions to cover a large part of the syllabus Selective revision will limit the number of questions you can answer and hence reduce your chances... well as doing the calculations Avoid looking at the answer until you have finished a question Your biggest problem with F5 questions may be knowing how to start, and this needs practice Also ensure that you attempt all three mock exams under exam conditions x Revising F5 Passing the F5 exam Displaying the right qualities You are expected to have a core of management accounting knowledge from your previous... so that the marker can identify them all rather than getting lost in the detail Provide answers in the form requested Use a report format if asked for and give recommendations if required xii Revising F5 Exam formulae Set out below are the formulae which you will be given in the exam in a formulae sheet You should learn to use them If you are not sure what the symbols mean, or how the formulae are used,... time per unit to produce X units a = the time taken for the first unit of output x = the cumulative number of units b = the index of learning (log LR/log 2) LR = the learning rate as a decimal Revising F5 xiii Exam information Format of the exam All questions are compulsory 20 multiple choice questions in Section A, each worth 2 marks Five compulsory questions in Section B Three of these are 10-mark... questions that cover key topics, so that you can locate the questions that provide practice on these topics, and see the different ways in which they might be examined Making the most of question practice At BPP Learning Media we realise that you need more than just questions and model answers to get the most from your question practice Our top tips included for certain questions provide essential advice ... success ACCA F5 ACCA approved content provider ACCA APPROVED CONTENT PROVIDER ACCA Approved Practice & Revision Kit Paper F5 Performance Management Practice & Revision Kit for exams up to June 2015. .. coverage, the BPP Learning Media Practice and Revision Kit provides excellent, ACCA- approved support for your revision Tackling revision and the exam Using feedback obtained from the ACCA exam team... and contains: Practice & Revision Kit Paper F5 Performance Management This Kit provides material specifically for the practice and revision stage of your studies for Paper F5 Performance Management