CIMA Exam CIMAPRO19-P02-1 Topic 3 Question 86 Discussion

Actual exam question for CIMA's CIMAPRO19-P02-1 exam

Question #: 86
Topic #: 3

A supermarket group has experienced operational problems during recent years, including a shortage of warehousing space due to increasing turnover and poor inventory management. The product portfolio has expanded considerably. Although this has led to increased sales volume, marketing and logistics costs have increased disproportionately. Non product-specific costs have also increased significantly.

Management is now considering using Direct Product Profitability (DPP).

Which of the following statements are valid in respect of the possible implementation of DPP within the supermarket group?

Select ALL that apply.

ADPP should result in improved management of storage space.

BDPP should result in improved supplier relationships.

CDPP should result in improved pricing decisions.

DDPP requires non product-specific costs to be apportioned rather than allocated.

EDPP provides summary information on the profitability of each customer group.

Show Suggested Answer

Suggested Answer: A, C, D

by Tanja at Apr 26, 2024, 09:23 AM

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Sina

8 days ago

I'm not so sure about Option E. Wouldn't DPP focus more on product profitability rather than customer groups? That's a bit of a stretch in my opinion.

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24 days ago

I think A) DPP should result in improved management of storage space.

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