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CIMAPRA19-F01-1 Exam - Topic 2 Question 126 Discussion

AA manufactures computers. These are sold to BB at $100 a computer plus a 5% sales tax. BB subsequently sells the computers to CC for $200 a computer plus a 5% sales tax. C sells the computers to customers at $300 a computer plus a 5% sales tax.The total tax received by the tax authority is $30.Which type of tax is described above?
D) Multi-stage cumulative sales tax
A) Single-stage sales tax
B) Value added tax
C) Retail tax

CIMAPRA19-F01-1 Exam - Topic 2 Question 126 Discussion

Actual exam question for CIMA's CIMAPRA19-F01-1 exam
Question #: 126
Topic #: 2
[All CIMAPRA19-F01-1 Questions]

AA manufactures computers. These are sold to BB at $100 a computer plus a 5% sales tax. BB subsequently sells the computers to CC for $200 a computer plus a 5% sales tax. C sells the computers to customers at $300 a computer plus a 5% sales tax.

The total tax received by the tax authority is $30.

Which type of tax is described above?

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Suggested Answer: D

by Eun at May 15, 2026, 10:53 AM

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Salome
10 hours ago
Definitely, it’s about the value added at each stage.
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Veronika
6 days ago
I think it's a value added tax.
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Gearldine
11 days ago
Yup, VAT all the way!
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Izetta
16 days ago
This is a classic example of multi-stage cumulative sales tax.
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Elenor
21 days ago
Wait, how is the total tax only $30? That seems low.
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Martina
26 days ago
Totally agree, it's definitely a VAT!
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Earleen
1 month ago
It's a value added tax since each stage adds value.
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Kaycee
1 month ago
Multi-stage cumulative sales tax sounds off to me.
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Lorrine
1 month ago
I thought it was a retail tax at first.
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Miles
2 months ago
Wait, how does the total tax add up to $30?
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Nichelle
2 months ago
Totally agree, it's definitely a VAT.
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Alysa
2 months ago
It's a value added tax since each stage adds value.
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Elli
2 months ago
I’m confused about the difference between single-stage and multi-stage. I thought both could apply, but maybe the total tax amount helps clarify it?
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Jacquelyne
2 months ago
This question reminds me of a practice problem we did on multi-stage taxes. I feel like the answer could be that one.
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Merri
2 months ago
I'm not entirely sure, but I remember something about retail tax being simpler and not involving multiple stages like this.
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Margo
4 months ago
I think this might be a value added tax since it seems to be applied at each stage of the sale.
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