CIMA Exam CIMAPRO19-P01-1 Topic 5 Question 86 Discussion

Actual exam question for CIMA's CIMAPRO19-P01-1 exam

Question #: 86
Topic #: 5

Which THREE of the following are advantages of activity-based costing (ABC), in a multi-product environment, when compared with traditional absorption costing?

AABC provides a better understanding of overhead costs.

BABC provides more accurate product costs in a complex business environment.

CABC is cheaper to operate.

DABC results in increased unit profit for each product.

EABC leads to better product pricing decisions.

Show Suggested Answer

Suggested Answer: A, B, C

References:

by Pilar at Apr 27, 2024, 07:44 PM

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Avery

14 days ago

A, B, and E seem like the obvious choices here. ABC is great for understanding overhead and making better pricing decisions in a complex business.

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Matthew

21 days ago

I believe D is also an advantage of ABC, as it can result in increased unit profit for each product.

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Billye

23 days ago

I agree with Barrie. ABC helps in understanding overhead costs and making better product pricing decisions.

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Barrie

25 days ago

I think A, B, and E are advantages of ABC.

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