management accounting mixed questions 613576

Question No. 1 “In medium and large organisations there is usually a significant separation between ownership and management. Owners often face problems in encouraging goal congruence of managers”. Required: In the context of this statement discuss fully the following; Goal congruence. Illustrate your answer with at least two specific examples of situations or circumstances that would foster goal congruence and at least two specific examples of situations or circumstances that would lead to goal incongruence. Question No. 2 Define the following terms and provide an example of each to illustrate your definition. i. Normal activity ii. Practical activity iii. Theoretical activity Question No. 3 a. Explain the positive and negative outcomes of participative budgeting. (4 MARKS – Suggested time 12 minutes) b. Discuss the following comment by the manager of a small manufacturing company: ‘Budgeting is a waste of time. I’ve been running this business for forty years. I don’t need to plan.’ (3 MARKS – Suggested time 9 minutes) c. Discuss the following comment by the manager of a marketing research company made the following comment: ‘I don’t understand why I should be concerned with motivation when setting my budget. It is my job to set targets and it is my employees’ job to meet them.’ Question No. 4 Activity-based costing systems can identify costs for all activities, not just manufacturing overhead activities. For each of the following businesses, speculate on and list three key activities that are likely to be important in the provision of the firm’s service. (Remember, these activities do not have to be overhead activities.) For each activity, suggest an appropriate cost driver to use in assigning costs from the activity cost pool to the services provided. i. Legal firm. ii. Automobile repair shop. iii. Laundry Question No. 5 Explain the meaning of the variable overhead efficiency variance. Support your answer by distinguishing between the direct…