Free CIMA CIMAPRA19-P02-1-ENG Exam Questions

Become CIMA Certified with updated CIMAPRA19-P02-1-ENG exam questions and correct answers

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Total 205 Questions | Updated On: Mar 13, 2026

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Question 1

A company is classifying its quality costs to prepare a quality cost report. Which of the following are conformance costs?
Select ALL that apply.

A : ternal Failure Costs

B : evention Costs

C : praisal Costs

Answer: B,C

Question 2

Which TWO of the following expressions are correct?

A : 1 + money rate = (1 + real rate) x (1 + inflation rate)

B : 1 + real rate = (1 + money rate) / (1 + inflation rate)

C : 1 + real rate = (1 + inflation rate) / (1 + money rate)

D : 1 + money rate = (1 + inflation rate) / (1 + real rate)

E : 1 + inflation rate = (1 + money rate) x (1 + real rate)

Answer: A,B

Question 3

A manufacturing company has recently introduced a Total Quality Management (TQM) system. The company has invested heavily in the education and training of its staff, in addition to implementing new product design engineering. There is a plan to sample units from each batch of products manufactured to test for errors, although this has not yet been implemented due to budget constraints.
The company is experiencing high levels of customer complaints, with many faulty units being returned by the customer for refund or replacement. Sales revenue has fallen recently, mainly due to negative press coverage linked to dissatisfied customers.
Select the statement MOST likely to apply.

A : high level of external failure costs is the result of a lack of expenditure on prevention costs.

B : high level of internal failure costs is the result of a lack of expenditure on appraisal costs.

C : high level of external failure costs is the result of a lack of expenditure on appraisal costs.

D : high level of internal failure costs is the result of a lack of expenditure on prevention costs.

Answer: C

Question 4

A project has a positive net present value (NPV) when discounted at a company's weighted average cost of capital (WACC). The project has also been evaluated using a range of other investment appraisal techniques.
It has now been recognized that the project is of much higher risk than the average risk of the company's existing portfolio of projects. It has therefore been decided that the discount rate to be used when evaluating this project should be the WACC adjusted for risk.
As the result of changing the discount rate as described, which of following statements are correct?
Select ALL that apply.

A : net present value would decrease.

B : internal rate of return would decrease.

C : accounting rate of return would decrease.

D : internal rate of return would remain unchanged.

E : The profitability index would remain unchanged.

F : The net present value would increase.

Answer: A,D

Question 5

When considering a capital investment, relevant costs for decision making have which THREE of the following features?

A : ey are future costs.

B : ey are committed costs.

C : ey are incremental costs.

D : They are unavoidable costs.

E : ey are cash flows.

Answer: A,C

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Total 205 Questions | Updated On: Mar 13, 2026

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