CIMA Exam CIMAPRO19-P02-1 Topic 3 Question 98 Discussion

Actual exam question for CIMA's CIMAPRO19-P02-1 exam

Question #: 98
Topic #: 3

[All CIMAPRO19-P02-1 Questions]

When considering a capital investment, relevant costs for decision making have which THREE of the following features?

AThey are future costs.

BThey are committed costs.

CThey are incremental costs.

DThey are unavoidable costs.

EThey are cash flows.

Show Suggested Answer

Suggested Answer: A

by Josphine at Sep 13, 2024, 06:36 PM

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Shonda

4 months ago

This question is making my brain hurt. Why can't they just ask about sunk costs? That's the only thing I'm really confident about in capital investment decisions.

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Tiffiny

2 months ago

Let's focus on understanding the concept of relevant costs better.

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Twila

2 months ago

Committed costs and unavoidable costs are not relevant for decision making.

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Geraldo

2 months ago

I think the relevant costs for decision making are future costs, incremental costs, and cash flows.

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Lottie

2 months ago

I agree, sunk costs are easier to understand.

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Scarlet

4 months ago

Haha, if only the answer was as easy as 'cash is king'! But of course, there's more to it than that. Gotta consider those incremental costs too.

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Paris

4 months ago

Yes, cash flows and future costs are also crucial factors to take into account. It's not just about the initial investment.

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Ashton

4 months ago

True, incremental costs are definitely important to consider when making capital investment decisions.

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Lindy

4 months ago

I'm pretty sure committed and unavoidable costs are also important, but I'm not 100% sure. Hmm, maybe I should review my notes on this topic again.

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Janna

4 months ago

A, C, and E seem like the relevant features for capital investment decision-making. The future costs and incremental cash flows are crucial factors to consider.

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