CIMA Exam CIMAPRA17-BA2-1 Topic 1 Question 63 Discussion

Actual exam question for CIMA's CIMAPRA17-BA2-1 exam

Question #: 63
Topic #: 1

A company which manufactures and sells one product has fixed costs of $80,000 per period. The selling price per unit of $25 generates a contribution/sales ratio of 40%.

How many units would need to be sold in a period to earn a profit of $10,000?

A9,000

B8,000

C36,000

D32,000

Show Suggested Answer

Suggested Answer: B

by Viva at Jan 23, 2024, 04:46 AM

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Vivan

1 months ago

Time to unleash my inner accountant! This is right up my alley. I bet I can solve this in my sleep.

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Tresa

18 days ago

Let's plug in the numbers and solve for Units. Profit = ($25 * Units) - ($10 * Units) - $80,000

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Kattie

21 days ago

We need to use the formula: Profit = (Selling Price * Units) - (Variable Cost * Units) - Fixed Costs

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Ivan

1 months ago

Haha, looks like they're trying to trick us with all these numbers. Better stay focused and not get too distracted by the fancy jargon.

upvoted 0 times

Dong

6 days ago

So, the answer would be 8,000 units, right?

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Hubert

7 days ago

I think we can use the contribution/sales ratio to calculate this.

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Ceola

28 days ago

We need to figure out how many units to sell to make a profit of $10,000.

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Valda

1 months ago

Ooh, this looks tricky. I better double-check my work to make sure I don't end up with the wrong answer. Can't afford to lose points on this one!

upvoted 0 times

This seems like a straightforward break-even analysis problem. I'll have to calculate the contribution margin per unit and the total fixed costs to find the number of units needed to reach the target profit.

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Moon

2 months ago

So, the contribution per unit is $10. We can use this to find the number of units needed to earn a profit of $10,000.

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Tamie

2 months ago

I agree. The contribution margin is 40% of the selling price.

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Moon

2 months ago

I think we need to calculate the contribution margin first.

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Jina

2 months ago

So, to earn a profit of $10,000, we need to cover the fixed costs and then make an additional $10,000.

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Fairy

2 months ago

I agree. The contribution margin is 40%.

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Jina

2 months ago

I think we need to calculate the contribution margin first.

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CIMA Exam CIMAPRA17-BA2-1 Topic 1 Question 63 Discussion

Contribute your Thoughts:

Vivan

Tresa

Kattie

Ivan

Dong

Hubert

Ceola

Valda

Phil

Terrilyn

Donte

Catherin

Dottie

Moon

Tamie

Moon

Jina

Fairy

Jina