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CIMAPRO19-P01-1 Exam - Topic 3 Question 59 Discussion

FGH used to manufacture components that required raw material Q.Currently there are 80 kg of material Q in inventory.The company has no use for the material in the foreseeable future and intends to sell it for scrap.A potential new customer has asked for a price for a large order.This order would require 100 kg of material Q.The company management has decided to quote a price for this work on a relevant cost basis.Details of costs for material Q are as follows:What would be the relevant cost of Material Q to use in this order?
C) $110
A) $230
B) $198
D) $46

CIMAPRO19-P01-1 Exam - Topic 3 Question 59 Discussion

Actual exam question for CIMA's CIMAPRO19-P01-1 exam
Question #: 59
Topic #: 3
[All CIMAPRO19-P01-1 Questions]

FGH used to manufacture components that required raw material Q.

Currently there are 80 kg of material Q in inventory.

The company has no use for the material in the foreseeable future and intends to sell it for scrap.

A potential new customer has asked for a price for a large order.

This order would require 100 kg of material Q.

The company management has decided to quote a price for this work on a relevant cost basis.

Details of costs for material Q are as follows:

What would be the relevant cost of Material Q to use in this order?

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Suggested Answer: C

by Lonna at Oct 14, 2022, 04:54 AM

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Tamra
10 months ago
Totally agree, they should focus on the scrap value for pricing!
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Justine
10 months ago
Relevant cost should be based on the scrap value, right?
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Ashton
10 months ago
Wait, how can they sell 100 kg if they only have 80 kg?
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Trevor
11 months ago
Quoting on a relevant cost basis makes sense here.
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Tiera
11 months ago
The company has 80 kg of material Q in stock.
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Lorrie
11 months ago
I recall that relevant costs only include future costs, so we might need to focus on the cost of acquiring more material Q for the order.
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Rosenda
11 months ago
I’m a bit confused about whether the inventory cost should be included since they plan to sell it. Does that affect the relevant cost?
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Latosha
11 months ago
I think we practiced a similar question where we had to calculate the cost of leftover materials. I believe we need to consider the selling price of the scrap.
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Freeman
11 months ago
I remember we discussed relevant costs in class, but I'm not entirely sure how to apply it to this scenario with the scrap material.
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Amber
11 months ago
I feel pretty confident about this one. The diagram is clearly showing how the main technology function "A" is made up of four different functions, with one of them (Administrate Replication) triggering the other three. I'll go with that option.
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Arlen
11 months ago
I'm a bit confused on this one. Should I be setting the time zone in Dynamics 365 personal options, or is there a more global setting I need to configure? I want to make sure the schedule is accurate for all users, so I'll need to research the best approach.
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Kanisha
11 months ago
Hmm, this seems to be asking about some kind of production process and bottlenecks. I'll need to think through the key concepts here to figure out the right answer.
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Lindsey
11 months ago
No problem, I've worked with 3D models before. I'll just need to remember the exact steps to resize and position it properly. Shouldn't be too difficult.
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