ACCA PERFORMANCE MANAGEMENT (PM)
MOCK EXAM 1 — 2026/27
Original practice examination | 100 marks
Current PM format: 3 hours, all questions compulsory; Section A = 30 marks, Section B = 30 marks, Section C = 40 marks. This is
an independent mock, not an ACCA past/specimen paper.
Suggested timing: Section A 30 min • Section B 54 min • Section C 72 min • Review 24 min.
ACCA PM 2026/27 — Mock Exam 1 Page 1
, SECTION A — OBJECTIVE TEST QUESTIONS (30 MARKS)
A1. An integrated information system primarily aims to:
A. eliminate judgement B. improve information flow and consistency across functions C. guarantee profit D. remove controls
A2. Selling price $75, variable cost $45 and fixed costs $180,000. Break-even output?
A. 4,000 B. 6,000 C. 7,500 D. 12,000 units
A3. A relevant cost is normally:
A. historical B. future and different between alternatives C. unavoidable D. already incurred
A4. Cost pool $72,000; 2,400 inspections. ABC driver rate?
A. $20 B. $24 C. $30 D. $36
A5. X earns $18 contribution using 1.5 machine hours. Y earns $15 using 0.75 hours. Which ranks first under the
constraint?
A. X B. Y C. equal D. cannot tell
A6. Output 8,000 units; standard material 3 kg/unit. Standard quantity?
A. 2,667 kg B. 11,000 kg C. 24,000 kg D. 30,000 kg
A7. Which variance is directly affected by actual material price?
A. material price B. material usage C. labour efficiency D. fixed OH volume
A8. Profit $240,000; capital employed $1.6m. ROI?
A. 12% B. 15% C. 18% D. 20%
A9. Which balanced scorecard perspective focuses on employee skills and capability?
A. financial B. customer C. internal process D. learning and growth
A10. A correlation coefficient of -0.9 indicates:
A. strong positive causation B. strong negative linear association C. no association D. 90% fall in sales
A11. A flexible budget is used to:
A. ignore activity B. adjust expectations to actual activity C. eliminate variances D. replace standards
A12. Target price $120; target profit $30. Target cost?
A. $30 B. $90 C. $120 D. $150
A13. Which is a sunk cost?
A. future material B. opportunity cost C. research expenditure already incurred D. overtime
A14. A favourable variance means:
A. always good management B. better numerical outcome than standard/budget C. always controllable D. always caused by
higher sales
A15. Best measure for a scarce resource?
A. contribution/unit B. profit/employee C. contribution/limiting-factor unit D. fixed cost
ACCA PM 2026/27 — Mock Exam 1 Page 2
MOCK EXAM 1 — 2026/27
Original practice examination | 100 marks
Current PM format: 3 hours, all questions compulsory; Section A = 30 marks, Section B = 30 marks, Section C = 40 marks. This is
an independent mock, not an ACCA past/specimen paper.
Suggested timing: Section A 30 min • Section B 54 min • Section C 72 min • Review 24 min.
ACCA PM 2026/27 — Mock Exam 1 Page 1
, SECTION A — OBJECTIVE TEST QUESTIONS (30 MARKS)
A1. An integrated information system primarily aims to:
A. eliminate judgement B. improve information flow and consistency across functions C. guarantee profit D. remove controls
A2. Selling price $75, variable cost $45 and fixed costs $180,000. Break-even output?
A. 4,000 B. 6,000 C. 7,500 D. 12,000 units
A3. A relevant cost is normally:
A. historical B. future and different between alternatives C. unavoidable D. already incurred
A4. Cost pool $72,000; 2,400 inspections. ABC driver rate?
A. $20 B. $24 C. $30 D. $36
A5. X earns $18 contribution using 1.5 machine hours. Y earns $15 using 0.75 hours. Which ranks first under the
constraint?
A. X B. Y C. equal D. cannot tell
A6. Output 8,000 units; standard material 3 kg/unit. Standard quantity?
A. 2,667 kg B. 11,000 kg C. 24,000 kg D. 30,000 kg
A7. Which variance is directly affected by actual material price?
A. material price B. material usage C. labour efficiency D. fixed OH volume
A8. Profit $240,000; capital employed $1.6m. ROI?
A. 12% B. 15% C. 18% D. 20%
A9. Which balanced scorecard perspective focuses on employee skills and capability?
A. financial B. customer C. internal process D. learning and growth
A10. A correlation coefficient of -0.9 indicates:
A. strong positive causation B. strong negative linear association C. no association D. 90% fall in sales
A11. A flexible budget is used to:
A. ignore activity B. adjust expectations to actual activity C. eliminate variances D. replace standards
A12. Target price $120; target profit $30. Target cost?
A. $30 B. $90 C. $120 D. $150
A13. Which is a sunk cost?
A. future material B. opportunity cost C. research expenditure already incurred D. overtime
A14. A favourable variance means:
A. always good management B. better numerical outcome than standard/budget C. always controllable D. always caused by
higher sales
A15. Best measure for a scarce resource?
A. contribution/unit B. profit/employee C. contribution/limiting-factor unit D. fixed cost
ACCA PM 2026/27 — Mock Exam 1 Page 2
