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APICS Exam CPIM Topic 1 Question 95 Discussion

Actual exam question for APICS's CPIM exam
Question #: 95
Topic #: 1
[All CPIM Questions]

An income statement of a company is as follows:

Profit has been increased by 60% to get the in profit by 600,000 by increasing revenue; sales would have to increase to 1.2 million. What will happen with CGS?

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Suggested Answer: A

by Ellsworth at Aug 22, 2024, 08:48 AM

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Valene
17 days ago
Alright, time to put on my accountant hat. If revenue goes up by 1.2 million and profit goes up by 600,000, then CGS must have gone down. C all the way, baby!
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Jerilyn
20 days ago
Hmm, I'm sensing a trick question here. What if the company just decided to throw money at the problem and increase everything by 4%? Wouldn't that work too? Oh, the joys of corporate finance...
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Jamey
24 days ago
I'll go with C on this one. Decrease by 4%. Gotta love these cost-cutting exercises, am I right? Saves the company a bundle!
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Quentin
1 months ago
Wait, if revenue increases by 1.2 million and profit increases by 600,000, that means the cost of goods sold (CGS) must have decreased. Simple math, folks!
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Jenelle
28 days ago
A) Decrease by 3%
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Jackie
2 months ago
Okay, so we need to increase profit by 600,000 and revenue by 1.2 million. Seems like CGS needs to decrease to maintain the 60% profit increase. Looks like C is the correct answer.
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Van
14 days ago
User 2: Yeah, decreasing CGS makes sense to increase profit.
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Jordan
24 days ago
Yes, I think choosing option C to decrease CGS by 4% is the right decision.
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Salome
25 days ago
So, decreasing CGS by 4% makes sense to maintain the profit margin.
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Lorriane
27 days ago
User 1: I think you're right, C is the correct answer.
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Jeniffer
30 days ago
But we also need to consider the cost of goods sold, it might need to decrease to achieve the profit increase.
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Stephane
1 months ago
I agree, increasing revenue by 1.2 million seems like a good strategy.
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Kristel
2 months ago
But if profit increased by 60%, then CGS should decrease to maintain the same profit margin. So, I still think it's C)
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Alfreda
2 months ago
I disagree, I believe the answer is A) Decrease by 3%
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Kristel
2 months ago
I think the answer is C) Decrease by 4%
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