Question 1

A co league claims that morality is usually perceived and interpreted differently by different people so there is no method to judge whether one decision is better than another. This is commonly referred to as

Options :

A : ethical relativity

B : moral philosophy

C : comparative ethics

D : moral relativism

Answer: D

Question 2

As the number of stocks in a portfolio increases, unsystematic risk

Options :

A : decreases and systematic risk decreases

B : increases, and systematic risk increases

C : decreases and systematic risk does not change

D : increases, and systematic risk does not change

Answer: C

Question 3

A management accountant overheard the company's procurement manager discussing a kickback payment for one of the company s recent projects. The procurement manager promised to pay a share to the other person II the arrangement was kept confidential According to the IMA Statement of Ethical Professional Practice which one of the following is the most appropriate action for the management accountant to take?

Options :

A : Take no action since the incident is not related to the accounting department

B : Report the information directly to a nigh-level company executive since it is a serious matter

C : Call the company-s ethics helpline and report the matter anonymously

D : Discuss the incident with his or her own attorney and consider disassociating from the company

Answer: B

Question 4

Marsalls Products Inc. manufactures and sells two products CD-ROMs and DVD's. The latest forecast on me

products and their costs tor the coming year is shown in the following table.

Note 1: Fixed manufacturing cost of Si.500 000 per year is allocated to products based on the number of

machine hours required to produce the product at a rate of S3 per machine hour

The Manufacturing Team leader just informed the CEO that a fire occurred at one of the manufacturing lines

and that line would be unavailable for the next 12 months. The result is that mere will only be 400 000

machine Hours available The CEO requested the management team to revise the plan for the coming year

based on the new constraint. The Marketing Team leader stated that in order to minimize customer complaints

about the shortage, a minimum of 100,000 units of each product should be produced With the new information

from the Manufacturing and Marketing teams what is the optimal product mix for the coming 12 months''

Assume Marsalls can sell allot its production.

Options :

A : 100,000 CD-ROM-s and 150,000 DVD'[s

B : 120.000 CD-ROM-s 140,000 DVD.

C : 150.000 CD-ROMS and 125.000 DVD

D : 200,000 CD-ROm-s a dn 100,000 DVD

Answer: D

Question 5

Which one of the following situations describes a secondary offering of stock by a company?

Options :

A : The company has an initial public offering of its stock and its investment bank needs to add mote shares to the initial public offering to meet excess demand by investors

B : After the lockup period of the initial public offering ends, the company 3 founders sell some of their shares to the public

C : The company repurchases shares of its stock in the open market, but it then later sells these shares in the open market

D : After completing its initial public offering, the company sells more new shares of its stock

Answer: B

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