CIMA Exam CIMAPRO19-P02-1 Topic 7 Question 93 Discussion

Actual exam question for CIMA's CIMAPRO19-P02-1 exam

Question #: 93
Topic #: 7

The manager of Ice Sculpting Co. believes that too much material is being wasted during downtime. She researched, and found throughput accounting to be an adequate alternative. However, she wasn't sure if all that

she read was accurate.

Which of the following statements are TRUE when using Throughput Accounting? Select ALL that apply.

AIf there is no demand, then there should be no production.

BNot all sales equal to profit

CStocking up on inventory is bad for business.

DAll costs, except materials, are considered fixed.

EDepartments should be operating at full capacity regardless of bottlenecks

Show Suggested Answer

Suggested Answer: A, C, D

by Kaycee at Jul 18, 2024, 05:29 AM

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Rolande

4 months ago

I'm just hoping the exam question doesn't ask us to juggle ice sculptures. That would be a real 'meltdown' of a question.

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Yoko

4 months ago

This is a classic case of 'work smarter, not harder'. Throughput accounting is the way to go, instead of just blindly producing.

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Hana

3 months ago

That's true! Throughput accounting really helps in optimizing production and reducing waste.

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Evan

3 months ago

E) Departments should be operating at full capacity regardless of bottlenecks

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Genevive

3 months ago

C) Stocking up on inventory is bad for business.

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Mertie

4 months ago

B) Not all sales equal to profit

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Vi

4 months ago

E is false. Throughput accounting is all about identifying and managing the bottleneck, not maximizing capacity everywhere.

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Catarina

4 months ago

E is false. Throughput accounting is all about identifying and managing the bottleneck, not maximizing capacity everywhere.

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Benton

4 months ago

C) Stocking up on inventory is bad for business.

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Muriel

4 months ago

B) Not all sales equal to profit

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Vallie

4 months ago

I think option C is true too. Stocking up on inventory ties up cash that could be used elsewhere.

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Cortney

5 months ago

That's a good point, Devora. Option B does make sense in the context of throughput accounting.

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Devora

5 months ago

I believe option B is also true because not all sales contribute to profit.

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Armanda

5 months ago

D is also true. Throughput accounting considers only variable costs, treating everything else as fixed.

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Fausto

5 months ago

A, B, and C are definitely true. Throughput accounting focuses on maximizing throughput, not minimizing costs. No point in producing if there's no demand.

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Lemuel

4 months ago

C) Stocking up on inventory is bad for business.

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Serina

4 months ago

B) Not all sales equal to profit

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Owen

4 months ago

A) If there is no demand, then there should be no production.

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Daniel

4 months ago

Not all sales equal to profit

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Theola

4 months ago

If there is no demand, then there should be no production.

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Herminia

4 months ago

A, B, and C are definitely true. Throughput accounting focuses on maximizing throughput, not minimizing costs. No point in producing if there's no demand.

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Vallie

5 months ago

I agree with Cortney, option A seems like a logical choice.

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Cortney

5 months ago

I think option A is true because it makes sense to not produce if there is no demand.

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