CIMA Exam CIMAPRO19-P01-1 Topic 5 Question 86 Discussion

Actual exam question for CIMA's CIMAPRO19-P01-1 exam

Question #: 86
Topic #: 5

Which THREE of the following are advantages of activity-based costing (ABC), in a multi-product environment, when compared with traditional absorption costing?

AABC provides a better understanding of overhead costs.

BABC provides more accurate product costs in a complex business environment.

CABC is cheaper to operate.

DABC results in increased unit profit for each product.

EABC leads to better product pricing decisions.

Show Suggested Answer

Suggested Answer: A, B, C

References:

by Pilar at Apr 27, 2024, 07:44 PM

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Louis

9 months ago

D also discusses probability of each NPV, could work for zero activities deviation.

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Hyun

9 months ago

What about D? Small sample sizes seem risky.

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Vincenza

10 months ago

C looks correct too; combining probabilities to get expected values makes sense.

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Louis

10 months ago

True, and B seems to involve calculating the NPV for those estimates.

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Hyun

10 months ago

Option A seems logical; companies do that high, medium, low estimate.

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Vincenza

11 months ago

I think it's about analyzing risk using probability.

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Louis

11 months ago

Yeah, it's quite technical.

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Hyun

11 months ago

This question makes me a bit nervous.

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