CIPS L3M2 Exam - Topic 1 Question 13 Discussion

Actual exam question for CIPS's L3M2 exam

Question #: 13
Topic #: 1

[All L3M2 Questions]

'From an accounting perspective, added value is total XXXXXX minus total costs of all activities'.

Which word is missing?

ACosts

BExpenditure

CSavings

DRevenue

Show Suggested Answer

Suggested Answer: C

The Economic Order Quantity is a formula which attempts to calculate the most efficient quantity to order at any given time, by attempting to reconcile the cost of stockholding and the cost of plac-ing an order. This could then have implications for the timing of an order being placed.

The cost of holding stock can be reasonably accurately calculated and agreed with one's peers. However, determining the cost of placing an order can keep colleagues up late into the night, and can be a great topic to liven up a sleepy procurement / finance function.

by Estrella at Jun 23, 2024, 03:25 PM

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Suzan

3 months ago

"Savings" doesn't fit at all, right?

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Marguerita

3 months ago

I thought it was "Expenditure" at first.

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Shoshana

3 months ago

Wait, could it be "Costs"? That sounds off.

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Lachelle

4 months ago

Agreed, "Revenue" makes the most sense here.

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Anissa

4 months ago

It's definitely "Revenue."

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Jesusa

4 months ago

I thought "Expenditure" could work too, but it seems less common in this context.

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Jules

4 months ago

I practiced a similar question, and I feel like "Revenue" fits best, but I could be wrong.

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Georgiana

4 months ago

I'm not entirely sure, but I remember something about costs being subtracted from total income. Could it be "Costs"?

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Valentine

5 months ago

I think the missing word might be "Revenue," since added value usually relates to what you earn.

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Curtis

5 months ago

I've got this! The missing word is definitely "revenue". Added value is calculated by subtracting total costs from total revenue. Easy peasy!

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Lea

5 months ago

Ah, this is a tricky one. I'm a bit confused between "revenue" and "expenditure" as the possible answers. I'll need to review the concepts of added value and how it's calculated.

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Pamella

5 months ago

Okay, let me see. From the definition, added value is total something minus total costs. I'm leaning towards "revenue" as the missing word, but I want to double-check my understanding.

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Ming

5 months ago

Hmm, I'm not 100% sure about this one. I think the missing word could be "revenue" or "expenditure". I'll have to think it through carefully.

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Charlena

5 months ago

This one seems pretty straightforward. The missing word is clearly "revenue" since added value is calculated by subtracting total costs from total revenue.

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Janessa

5 months ago

Okay, I think I've got it. Based on the details provided, this has to be Twofish. I'm confident that's the right answer.

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Lisbeth

5 months ago

Hmm, I'm not sure about this one. I know we need to modify some configuration files, but I can't remember which ones exactly. I'll have to think this through carefully.

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Elbert

5 months ago

Okay, let me break this down. The key things to consider in audit planning are gathering background information, determining resources, and developing relevant audit criteria. I think option D covers those main areas.

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Gabriele

5 months ago

I'm a bit unsure on this one. I know the IETF is involved in internet standards, but I can't recall if they specifically became the standards body for IP. I'll have to think it through.

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Rodolfo

10 months ago

Costs, revenue, who cares? As long as the final answer is a number, I'll be happy. Where's the multiple-choice option for 'whatever works'?

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Xuan

8 months ago

Costs, revenue, who cares? As long as the final answer is a number, I'll be happy. Where's the multiple-choice option for 'whatever works'?

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Rosalyn

8 months ago

D) Revenue

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Amber

8 months ago

C) Savings

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Zena

8 months ago

B) Expenditure

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Ressie

8 months ago

A) Costs

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Marjory

10 months ago

I'm going with A) Costs. Subtracting total costs from total revenue is how you get added value, isn't it?

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Benedict

8 months ago

A) Costs is the missing word, good choice!

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Detra

9 months ago

That's right, subtracting costs from revenue gives you added value.

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Laurel

9 months ago

Yes, you're correct. It's A) Costs.

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Sylvia

10 months ago

Gotta be D) Revenue. I mean, who cares about costs or savings when you're trying to calculate added value? Show me the money!

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Catarina

8 months ago

I agree with you, it's D) Revenue. That's the key factor in determining added value.

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Lillian

9 months ago

I see your point, but I still think it's A) Costs. You have to consider all expenses.

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Vi

9 months ago

No way, it's definitely D) Revenue. That's the total income you're generating.

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Shannan

10 months ago

I think it's A) Costs. You need to subtract costs to calculate added value.

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Anglea

10 months ago

D) Revenue makes the most sense to me. Can't have added value without revenue, right?

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Iola

10 months ago

D) Revenue makes the most sense to me. Can't have added value without revenue, right?

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Fabiola

10 months ago

A) Costs

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Blondell

10 months ago

Hmm, I was leaning towards B) Expenditure, but now I'm not so sure. This is a tricky one.

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Lilli

11 months ago

I agree with Ahmed, A) Costs makes the most sense in this context.

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Ahmed

11 months ago

I think it's A) Costs because added value is calculated by subtracting costs from total revenue.

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Launa

11 months ago

I think it's D) Revenue. That's the classic definition of added value in accounting.

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Pamella

9 months ago

Yes, you're right. Added value is total revenue minus total costs of all activities.

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Lonna

10 months ago

Is it A) Costs? That would make sense in the context of the equation.

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Clare

10 months ago

No, it's not revenue. Think about the equation again.

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Benedict

10 months ago

I think it's D) Revenue. That's the classic definition of added value in accounting.

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Slyvia

11 months ago

A) Costs

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