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

Actual exam question for CIMA's CIMAPRO19-P01-1 exam

Question #: 88
Topic #: 9

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...

AUpgrade both models

BUpgrade Car 1 but not Car 2

CUpgrade Car 2 but not Car 1

DKeep both Cars as base models

Show Suggested Answer

Suggested Answer: A, B, C

References:

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

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Jennie

1 months 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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2 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

20 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

1 months ago

But what about customer demand? Maybe some customers prefer the upgraded Car 2 over the base model.

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Reta

1 months 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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3 months ago

I think we should upgrade both models to increase sales.

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