CIMA Exam CIMAPRO19-P02-1 Topic 8 Question 73 Discussion

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

Question #: 73
Topic #: 8

A company uses activity based costing. The total production overheads of $16,050 for the next period are for set up costs of $6,450 and quality inspection costs of $9,600. The company produces two products, Product F and Product G. Details relating to the next period are as follows:

A new customer has offered to purchase Product F for $28.00 per unit. The only costs incurred would be those shown above.

What is the profit per unit of Product F that would be gained by accepting the offer? Give your answer to two decimal places.

A$3.90

Show Suggested Answer

Suggested Answer: A, C, D

by Alline at Aug 09, 2023, 07:07 AM

Limited Time Offer

25%

Off

Get Premium CIMAPRO19-P02-1 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Leonard

11 days ago

Agreed. It seems like a profitable opportunity for the company.

upvoted 0 times

...

Lorean

12 days ago

Wait, wait, wait. Did you see the image? It's like a treasure map, but for accountants. I bet there's hidden gold in there somewhere!

upvoted 0 times

...

Pamella

13 days ago

Okay, this looks straightforward. We just need to calculate the profit per unit of Product F by subtracting the set-up and quality inspection costs from the selling price. Shouldn't be too hard.

upvoted 0 times

...

Sherell

14 days ago

Alright, let's see. The total production overheads are $16,050, and the company produces two products, F and G. The new customer is offering $28 per unit for Product F, and the only costs are the set-up and quality inspection costs. Hmm, let me think this through.

upvoted 0 times

...

Luisa

16 days ago

That sounds like a good deal. The company should definitely accept the offer then.

upvoted 0 times

...

Leonard

19 days ago

I think the profit per unit of Product F would be $3.90 if they accept the offer.

upvoted 0 times

...