Free CIMAPRO15-P01-X1-ENG Exam Braindumps (page: 2)

A company produces three products D, E and F.
The statement below shows the selling price and product costs per unit for each product, based on a traditional absorption costing system.


Each of the products is produced using Process A which has a maximum capacity of 2,500 hours per period.

If a traditional contribution approach is used, the ranking of products, in order of priority, for the profit maximizing product mix will be:

A company produces three products D, E and F. The statement below shows the selling price and product costs per unit for each product, based on a traditional absorption costing system.


Each of the products is produced using Process A which has a maximum capacity of 2,500 hours per period.

If a throughput accounting approach is used, the ranking of products, in order of priority, for the profit maximizing product mix will be:

‘A zero-based budgeting system involves establishing decision packages that are then ranked in order of their relative importance in meeting the organization’s objectives’.

Which of the following is true regarding he difficulties that a not-for-profit organization may experience when trying to rank decision packages.

Select ALL true statements.

A company is considering whether to develop an overseas market for its products. The cost of developing the new market is estimated to be $250,000. There is a 70% probability that the development of the new market will succeed and a 30% probability that the development of the new market will fail and no further expenditure will be incurred.

If the market development is successful, the profit from the new market will depend on prevailing exchange rates. There is a 50% chance that exchange rates will be in line with expectations and a profit of $500,000 will be made. There is a 20% chance that exchange rates will be favorable and a profit of $630,000 will be made and a 30% chance that exchange rates will be adverse and a profit of $100,000 will be made.

The profit figures stated are before taking account of the development costs of $250,000.
Use a decision tree to decide whether the company should develop an overseas market for its products.

Select one correct answer.