FINANCIAL MANAGEMENT TEST QUESTIONS (SECTION A) 1.

Internal Controls: As a Financial Manager or Controller, the responsibility of establishing and maintaining a system of internal accounting control rests with you. Describe certain areas in which internal control are required and type of controls that you will establish? 2. What is a Trend Analysis and what is it used for? 3. Define in your own words, what are some of the major responsibilities of a Financial Manager or Controller? 4. Define the purpose and objectives of Budgets and Types of Budgets prepared? 5. What is the difference between: a. Direct Costing Method and Absorption Method. b. Fixed Cost and Variable Cost

FINANCIAL MANAGEMENT TEST QUESTIONS (SECTION B) 1. The following data is available. Determine the Break Even point in Sales: Sales Fixed Expenses Variable Expenses 2. Cash Break Even: SIPW Company sell windows. Windows are sold for $ 25/- each. Variable cost is $ 15/per door and total Fixed Operating Costs are $ 50,000 /- which includes depreciation in the amount of $ 2,000/-. How many units of windows the company has to sell for Cash Break Even? 3. Cash Flow from Operation: Assume a company with an Income Statement showing: Net Income Depreciation Amortization Deferred Income What would be the: a) Cash Flow from operation b) Ratio of Cash Flow . . $ 180,000/$ $ $ 80,000/60,000/40,000/: : : $1,800,000/$ 375,000/$ 1,200,000/-

Q-4. Calculate the Revenue on Accrual Basis. Warren, a Consultant, keeps his accounting records on cash basis. During 1996, Warren collected $200,000 in fees from clients. At December 31, 1995, Warren had accounts receivable of $40,000. At December 31, 1996, Warren had accounts receivable of $60,000 and unearned fees of $5,000. On accrual basis, what was Warrens revenue for 1996? Please provide your calculation.

Q-5. Calculate the Gross Profit Using the Percentage-of-Completion Method. Jeddah Construction Co. (JCC) has consistently used the percentage-of-completion method. On January 10, 1995, JCC began work on a $3,000,000 construction contract. At the inception date, the estimated cost of construction was $2,250,000. The following data relate to the progress of the contract: Gross profit recognized at 12/31/95 Costs incurred 1/10/95 through 12/31/96 Estimated cost to complete 12/31/96 $300,000 $1,800,000 $600,000

In its income statement for the year ended December 31, 1996, what amount of gross profit should JCC report? Please provide your calculation?