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IIA Exam IIA-CIA-Part3-3P Topic 7 Question 60 Discussion

Actual exam question for IIA's IIA-CIA-Part3-3P exam
Question #: 60
Topic #: 7
[All IIA-CIA-Part3-3P Questions]

A bicycle manufacturer incurs a combination of fixed and variable costs with the production of each bicycle Which of the following statements true recording these costs?

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Suggested Answer: A

by Ilona at Dec 07, 2024, 12:59 AM

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Lai
3 months ago
Haha, the bicycle manufacturer must be really good at making those bikes if they can somehow make the fixed cost per unit go down when they increase production by 30%. That's some magic accounting right there!
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Irene
1 months ago
Eleni: Maybe the manufacturer found a way to be more efficient in their production process.
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Eleni
2 months ago
User 2: I agree, I think the fixed cost per unit is not supposed to decrease with increased production.
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Gregoria
2 months ago
User 1: Yeah, it does seem like magic! I think the fixed cost per unit usually stays the same.
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Gayla
3 months ago
Option D is definitely wrong. Fixed costs don't decrease just because you produce more units. That's not how fixed costs work.
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Temeka
1 months ago
Option D is definitely wrong. Fixed costs don't decrease just because you produce more units. That's not how fixed costs work.
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Luz
2 months ago
C) The total variable cost will vary proportionally and inversely with the number of bicycles produced during a production run
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Francine
2 months ago
A) If the number of bicycles produced is increased by 15 percent, the variable cost per unit will increase proportionally
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Jani
3 months ago
I'm not sure about option C. Doesn't the total variable cost usually increase with the number of units produced, not vary inversely?
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Gladys
2 months ago
User 2: I disagree. I believe the total variable cost usually increases with the number of units produced.
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Magdalene
3 months ago
User 1: I think option C is correct. The total variable cost does vary inversely with the number of bicycles produced.
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Caitlin
3 months ago
Option A seems correct. As the number of bicycles produced increases, the variable cost per unit should also increase proportionally.
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Annelle
2 months ago
That makes sense. So, option A is correct about the variable costs, but fixed costs remain constant per unit.
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Delsie
2 months ago
I think the fixed costs will stay the same per unit regardless of the number of bicycles produced.
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Ardella
2 months ago
But what about the fixed costs? Do you think they will also increase with production?
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Ronny
3 months ago
I agree, option A makes sense. The variable cost per unit should increase as production increases.
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Earleen
3 months ago
But if the number of bicycles produced increases, wouldn't the total variable cost also increase proportionally?
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Youlanda
4 months ago
I disagree, I believe the answer is A.
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Earleen
4 months ago
I think the answer is C.
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