Discuss CIPS L6M5 Exam Topic 2 Question 22

Casper is conducting a Variance Analysis of the company's budget. What is its main purpose?

Answer Options:

ATo identify which departments have overspent

BTo identify where cost savings can be made

CTo minimize inefficiencies

DTo analyze whether costs are fixed or variable

Suggested Answer: C

A Variance Analysis (p.95) compares planned vs. actual budget and identifies inefficiencies to enhance financial performance. Option A focuses only on overspending, B on cost-cutting, and D on categorizing costs rather than improving efficiency. [P.95]

Get Premium L6M5 Questions as Interactive Web-Based Practice Test or PDF Real Exam Format Detailed Explanations Instant Access Get Your Practice Test

20 comments · newest first

Aretha 2 months ago

I lean towards A, but B is a close second.

Craig 2 months ago

D is relevant, but not the main focus here.

Shawnda 2 months ago

C is important, minimizing inefficiencies helps overall.

Jarod 3 months ago

B makes sense too, finding cost savings is crucial.

Broderick 3 months ago

Definitely A! Departments need to be accountable.

Rodrigo 3 months ago

I think it's to identify overspending.

Rozella 3 months ago

I thought it was more about fixed vs. variable costs?

Georgiana 3 months ago

C) To minimize inefficiencies is super important too!

Matthew 4 months ago

Wait, isn't it also about finding cost savings?

Karl 4 months ago

Totally agree, that's the main goal!

Mari 4 months ago

A) To identify which departments have overspent.

Jesus 4 months ago

I thought it was more about fixed vs. variable costs?

Leandro 4 months ago

C) To minimize inefficiencies is super important too!

Ruthann 4 months ago

Wait, isn't it also about finding cost savings?

Emelda 6 months ago

Totally agree, that's the main goal!

Elroy 6 months ago

A) To identify which departments have overspent.

Felix 7 months ago

Analyzing fixed vs. variable costs seems relevant, but I don't think that's the main focus of variance analysis.

Andrew 7 months ago

I feel like minimizing inefficiencies is important too, but I can't recall if that's the primary goal of variance analysis.

Tijuana 7 months ago

I remember a practice question that emphasized finding cost savings, so I might lean towards option B.

Vincenza 7 months ago

I think the main purpose is to identify which departments have overspent, but I'm not entirely sure.

CIPS L6M5 Exam - Topic 2 Question 22 Discussion