AICPA Exam CPA-Business Topic 1 Question 67 Discussion

Actual exam question for AICPA's CPA-Business exam

Question #: 67
Topic #: 1

When applying value chain analysis, a firm asks it accounting department to perform an analysis of the sources of profits and costs of activities that exist within the firm. The firm is performing which form of value chain analysis?

AInternal differentiation analysis.

BInternal costs analysis.

CVertical linkage analysis.

DNone of the above.

Show Suggested Answer

Suggested Answer: B

Choice 'b' is correct. 150 units is the average inventory including a 50-unit safety stock.

Choices 'a', 'c', and 'd' are incorrect, per the above calculation.

by Paris at Mar 25, 2023, 05:49 PM

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Carli

11 hours ago

I'm just glad they didn't ask about the 'horizontal linkage analysis' - that's always a tough one to remember!

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Jolene

2 days ago

Hold on, this is a trick question! The question says the firm is performing 'value chain analysis,' and none of the options explicitly mention that. I'm going with D, 'None of the above.'

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Jenelle

9 days ago

I'm not convinced. Analyzing the sources of profits and costs within the firm sounds more like a vertical linkage analysis to me. Option C seems like the right choice.

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