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CIMA Exam CIMAPRO19-P01-1 Topic 9 Question 88 Discussion

Actual exam question for CIMA's CIMAPRO19-P01-1 exam
Question #: 88
Topic #: 9
[All CIMAPRO19-P01-1 Questions]

You are a management accounting working for a car manufacturer. The company is publicly listed and has been around for many years.

The company produces 2 products. Car 1 and Car 2. Car 1 sells for 20,000 and Car 2 for 27,000.

Car 1 can be upgraded post production to the 1ZC model for 5,000 and Car 2 to the 2ZC model for 3,500.

Post production upgrade the 1ZC sells for 25,500 and the 2ZCfor 30,000.

The company sources all of its supplies for the same supplier and has access to a large workforce. As a result there are no bottlenecks or limiting factors to production.

Based on the information above the company should...

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Suggested Answer: A, B, C

References:


by Cordelia at May 22, 2024, 12:25 AM

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Jennie
27 days ago
Option C, baby! Who needs Car 1 when you can have the luxury 2ZC model? Guess the other candidates haven't heard of upselling.
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Tiera
30 days ago
Haha, keep both as base models? Yeah, right. Might as well just give the profit away. Option A all the way!
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Hannah
1 months ago
I'm going with Option B. Upgrading Car 1 gives you a bigger margin boost compared to Car 2. Plus, not everyone wants the fancier 2ZC model.
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Barrie
3 days ago
That's a good point. It's important to consider customer preferences as well when making this decision.
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Noelia
16 days ago
But what about customer demand? Maybe some customers prefer the upgraded Car 2 over the base model.
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Reta
17 days ago
I agree with you, Option B seems like the best choice. Car 1 has a higher margin increase after the upgrade.
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Rhea
2 months ago
Upgrade both models? Sounds like a no-brainer to me. The extra revenue from the upgraded models more than makes up for the upgrade cost.
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Simona
9 days ago
B) Upgrade Car 1 but not Car 2
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Dorian
10 days ago
Absolutely, upgrading both models would increase revenue significantly.
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Kristel
14 days ago
A) Upgrade both models
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Dyan
2 months ago
I believe we should upgrade Car 1 but keep Car 2 as base model to maintain a balance.
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Kimberely
2 months ago
I disagree, upgrading both models might not be cost-effective in the long run.
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Leila
2 months ago
I think we should upgrade both models to increase sales.
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