CIMA Exam CIMAPRO19-P02-1 Topic 8 Question 91 Discussion

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

Question #: 91
Topic #: 8

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 Leatha at Jun 29, 2024, 07:19 AM

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Vanda

5 months ago

Hah! Looks like the manager needs to brush up on their Throughput Accounting knowledge. D and E are totally off base. This exam is a real 'ice' breaker, isn't it?

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Ryann

4 months ago

C) Stocking up on inventory is bad for business.

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Felicia

4 months ago

B) Not all sales equal to profit

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Lavera

4 months ago

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

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Lavonne

5 months ago

I agree with A and B, but C is a bit harsh. Stocking up can be necessary in some cases, but it needs to be managed carefully. D and E are tricky, I'm not sure about those.

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Roxanne

4 months ago

Yeah, I'm not sure about all costs being considered fixed either.

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Eden

4 months ago

I agree, it just needs to be managed carefully.

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Melissia

4 months ago

I think stocking up on inventory can be necessary sometimes.

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Telma

4 months ago

I'm not sure about D and E. Operating at full capacity seems intense.

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Raul

4 months ago

I agree. But I think stocking up on inventory can be risky.

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Leeann

4 months ago

I think A and B make sense. No demand means no need to produce, right?

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Shawn

6 months ago

I believe option D is also true. Throughput accounting focuses on material costs and considers other costs as fixed.

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Clemencia

6 months ago

A, B, and C are definitely true. Throughput Accounting is all about maximizing profit, not just production. Stocking up on inventory is a waste of resources.

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