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CIPS Exam L4M2 Topic 4 Question 52 Discussion

Actual exam question for CIPS's L4M2 exam
Question #: 52
Topic #: 4
[All L4M2 Questions]

A garment manufacturer supplies global retailers with t-shirts, shirts, and linen trousers. Because of currency fluctuations, the manufacturer is aware that they must control their direct costs in order to ensure profits. Which of the following is a direct cost for the garment manufacturer?

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Suggested Answer: B

Cotton fabric is a direct cost because it is directly attributable to the production of the garments. Costs like rent, utilities, and payroll are indirect costs associated with running the business. Reference: CIPS Level 4, Cost Categorization in Procurement.


by Jesse at Jan 12, 2025, 05:29 PM

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Francesco
5 months ago
I'm not sure about the others, but I think cotton fabric makes sense as a direct cost.
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Alona
5 months ago
B. Cotton fabric. Easy peasy. I'm not even going to bother with the other options. That's the only one that makes sense for a garment manufacturer.
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Karma
5 months ago
B: Agreed, it's the most obvious choice.
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Rosendo
5 months ago
A: Definitely B. Cotton fabric is a direct cost for a garment manufacturer.
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Susy
5 months ago
I agree with Cheryll. Cotton fabric is definitely a direct cost for the manufacturer.
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Cheryll
5 months ago
I think cotton fabric is a direct cost because it's directly used in making the garments.
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Glenn
5 months ago
I'm going with B. Cotton fabric. It's the core material used in the production of the garments, so it has to be a direct cost.
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Jacqueline
5 months ago
A: Exactly, it's a crucial component in their production process.
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Shawnee
5 months ago
B: Yeah, without the cotton fabric, they wouldn't be able to produce any garments.
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Golda
5 months ago
A: I agree, B) Cotton fabric is definitely a direct cost for the manufacturer.
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Aracelis
6 months ago
Haha, office staff payroll? That's definitely an indirect cost. I mean, unless the office staff are sewing the shirts themselves, it's not a direct cost.
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Starr
6 months ago
I agree with Tamesha. The question is specifically asking about direct costs, and cotton fabric is a clear direct cost for a garment manufacturer.
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Bettye
5 months ago
D: So, controlling the cost of cotton fabric is crucial for their profits.
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Rosalyn
5 months ago
C: It makes sense, since the manufacturer needs the fabric to make the garments.
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Lovetta
5 months ago
B: Definitely, cotton fabric is a direct cost for a garment manufacturer.
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Deja
5 months ago
A: B) Cotton fabric
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Tamesha
6 months ago
Definitely B. Cotton fabric is a direct cost in the manufacturing of garments. It's the raw material used to make the t-shirts, shirts, and linen trousers.
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Dianne
5 months ago
A: So, facilities rent, utilities cost, and office staff payroll are not direct costs?
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Sunshine
5 months ago
B: I agree, cotton fabric is the raw material used to make the garments.
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Anthony
6 months ago
A: I think the direct cost for the garment manufacturer is cotton fabric.
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