CIMAPRA17-BA2-1 Exam - Topic 2 Question 89 Discussion

Actual exam question for CIMA's CIMAPRA17-BA2-1 exam

Question #: 89
Topic #: 2

Johnson & Smith is a huge corporation with many different departments covering hundreds of activities. They had switched to this new budgeting technique as it seemed as though it would help them allocate their limited funds better.

It was successful to some extent as each manager was required to look at every cost his department accrued. They would then be responsible for coming up with new ways of performing these activities.

It became obvious that certain managers were unable to handle these paperwork intensive demands and so the company will be reverting back to a system that focuses primarily on cost drivers next year.

What budgeting technique will they be using next year?

AActivity Based Budgeting

BZero Based Budgeting

CIncremental Budgeting

Show Suggested Answer

Suggested Answer: C

by Sheron at Jan 24, 2025, 11:50 PM

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Malcom

9 months ago

Incremental Budgeting is too old-school for a big corp like that!

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Marguerita

10 months ago

I agree, some managers just can't handle the paperwork!

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Cecilia

10 months ago

Wait, are they really reverting? Sounds like a step back.

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Hana

10 months ago

I think Zero Based Budgeting makes more sense for them!

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Geraldine

10 months ago

They're going back to cost drivers, so probably Activity Based Budgeting.

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Jamie

10 months ago

I feel like they might choose Incremental Budgeting because it’s easier for managers who struggled with the new system.

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Arminda

11 months ago

I practiced a question like this before, and I think Zero Based Budgeting could also fit, but it sounds like they want something simpler.

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Susana

11 months ago

I'm not entirely sure, but I remember something about Activity Based Budgeting focusing on cost drivers, which seems relevant here.

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Sharan

11 months ago

I think they might be going back to Incremental Budgeting since it’s less paperwork intensive.

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Ty

11 months ago

I'm not totally sure about the differences between these budgeting methods, so I'll need to think it through carefully. Maybe I can eliminate a couple options and then make an educated guess.

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Page

11 months ago

The question mentions the company is reverting to a system focused on cost drivers, so I think the answer is probably Activity Based Budgeting. I feel pretty confident about that.

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Dorcas

11 months ago

Okay, got it. The company is moving away from a budgeting technique that required a lot of paperwork and individual manager responsibility. Based on that, I'm guessing the answer is Zero Based Budgeting.

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Gilberto

11 months ago

Hmm, I'm a bit confused by all the details in this question. I'll need to re-read it a few times to make sure I understand the key points before trying to answer.

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Bethanie

11 months ago

This seems like a straightforward question about budgeting techniques. I'll carefully read through the details and think about what budgeting method would make sense based on the information provided.

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Julian

1 year ago

Incremental Budgeting? Sounds like they're going for the 'if it ain't broke, don't fix it' approach. Although, with all those managers struggling with the paperwork, maybe they should consider a budgeting system that's a little more 'plug and play'.

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Dyan

1 year ago

B) Zero Based Budgeting

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Colton

1 year ago

I agree, maybe a more straightforward approach would be better for them.

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Franklyn

1 year ago

A) Activity Based Budgeting

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Georgene

1 year ago

Yeah, it seems like they want to simplify things next year.

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Hyun

1 year ago

C) Incremental Budgeting

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Terrilyn

1 year ago

B) Zero Based Budgeting

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Alease

1 year ago

A) Activity Based Budgeting

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Virgie

1 year ago

I bet the managers at Johnson & Smith are secretly hoping for Incremental Budgeting. It's like the comfy, old slippers of budgeting techniques - familiar and easy to slip into, even if they're a little worn out.

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Blair

1 year ago

A) Activity Based Budgeting

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Timothy

1 year ago

I agree, Incremental Budgeting seems like a safe choice.

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Teri

1 year ago

C) Incremental Budgeting

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Lilli

1 year ago

B) Zero Based Budgeting

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Odelia

1 year ago

A) Activity Based Budgeting

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Shelba

1 year ago

I'm not sure, but I think Zero Based Budgeting could also be a good option for them to consider.

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Ronna

1 year ago

Zero Based Budgeting? Sounds like a recipe for disaster. Those managers can't even handle the paperwork for the current system, let alone starting from scratch every year. Incremental Budgeting is the way to go, no doubt about it.

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Lou

1 year ago

Incremental Budgeting is definitely a more practical approach for a company like Johnson & Smith.

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Laticia

1 year ago

I agree, Zero Based Budgeting seems like a lot of work for managers who are already struggling with paperwork.

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Clare

1 year ago

I agree with Adria, Incremental Budgeting makes more sense for a large corporation like Johnson & Smith.

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Derick

1 year ago

Activity Based Budgeting? No way, that's way too complex for a large corporation like Johnson & Smith. They're definitely going with good old Incremental Budgeting - simple and straightforward, just the way they like it.

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