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CIPS L4M5 Exam - Topic 13 Question 45 Discussion

Actual exam question for CIPS's L4M5 exam
Question #: 45
Topic #: 13
[All L4M5 Questions]

Absorption costing is when the total cost per each unit of output:

Show Suggested Answer Hide Answer
Suggested Answer: C, E

There are many macro economic factors that could influence procurement in general and commercial negotiation in particular. Below are six factors that are agreed to be fairly significant:

* Economy growth rate

* Inflation rates

* Interest rates

* Currency exchange rate

* Unemployment rate

* Protectionism

LO 2, AC 2.2


by Arminda at Aug 08, 2023, 01:01 AM

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Armando
3 months ago
Definitely option C, it’s about total production costs!
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Barbra
3 months ago
Wait, does it really include all those costs? Sounds too good to be true.
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Micheal
4 months ago
I think it’s mostly about indirect costs, right?
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Queen
4 months ago
Totally agree, it covers all production costs!
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Johnna
4 months ago
Absorption costing includes both fixed and variable costs.
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Felix
4 months ago
I thought absorption costing was more about fixed costs, so D doesn't seem to fit, but I can't recall the exact details.
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Wenona
4 months ago
I'm a bit confused about the definitions, but I feel like A could be right since it talks about activity costs.
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Alica
5 months ago
I remember a practice question that mentioned total production costs, which makes me lean towards C.
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Annmarie
5 months ago
I think absorption costing includes indirect costs, so maybe it's B? But I'm not entirely sure.
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Chantell
5 months ago
I'm a little confused by this question. There are a few different options presented, and I'm not sure which one would be the most effective. I'll need to think it through carefully and review the details before deciding on the best approach.
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Vince
5 months ago
I remember a similar question where we discussed using charts to assess test progress. I think B might be correct since it reveals issues.
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Altha
5 months ago
FlightControl seems like it could be the feature they're looking for, but I'm a bit confused by the wording of the question.
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Martin
5 months ago
Wait, I'm a little confused. Is the independent variable the patient days or the maintenance cost? I need to re-read the question and data carefully to make sure I understand what they're asking for.
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Cristina
5 months ago
Hmm, I'm not too sure about this one. I know there are a lot of different IEEE standards and I'm not super familiar with the wireless ones. I'll have to think this through carefully.
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Truman
10 months ago
Well, time to put on my accountant hat. Option C is the clear winner here. Gotta love those indirect costs, am I right?
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Elza
9 months ago
I see your point, but I still think option A is the most accurate. Allocating towards the activity cost is key in absorption costing.
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Kathryn
10 months ago
I think option B is also important. Including an allocation towards indirect costs is crucial for accurate costing.
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Darrin
10 months ago
I agree, option C is the best choice. Indirect costs play a big role in absorption costing.
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Georgeanna
10 months ago
Haha, 'absorption costing' - sounds like something out of a science fiction movie! But in all seriousness, Option C is the way to go.
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Natalie
8 months ago
I'm not sure, but I think Option D might be the right choice for absorption costing.
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Jeannine
8 months ago
Actually, I believe Option A is the best answer, as it includes activity costs.
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Major
8 months ago
I think Option B makes more sense, as indirect costs are important in production.
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Carmelina
8 months ago
I agree, Option C is the correct choice.
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Fernanda
9 months ago
D) Includes an allocation of producing an additional unit
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Reid
9 months ago
C) Includes an allocation for a proportion of total production costs
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Albina
9 months ago
B) Includes an allocation towards indirect costs used in its creation
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Donte
9 months ago
A) Includes an allocation towards the activity cost of its creation
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Alonso
10 months ago
I agree with Georgene. Absorption costing is about including all costs associated with production, not just the direct costs.
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Michael
10 months ago
User 2
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Burma
10 months ago
User 1
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Azalee
10 months ago
I'm not sure, but I think it might be B, as indirect costs are also included in absorption costing.
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Hollis
11 months ago
I agree with Clare, because absorption costing includes a proportion of total production costs.
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Georgene
11 months ago
Option C seems to be the correct answer. Absorption costing includes an allocation of all production costs, both direct and indirect, to each unit of output.
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Willis
9 months ago
Exactly, it provides a more accurate reflection of the total cost of production.
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Lynelle
9 months ago
So, absorption costing helps in spreading out all production costs evenly across units.
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Cordelia
10 months ago
Yes, that's right. It includes both direct and indirect costs in the total cost per unit.
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Noah
10 months ago
I think option C is correct. Absorption costing includes all production costs in each unit.
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Clare
11 months ago
I think the answer is C.
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