Acca paper F1 fia diploma in Accounting and Business Accountant in Business (AB/fab) exam kit

115 D 
Outbound logistics includes packaging and delivery. 
116 B 
The receipt of the cable from the manufacturers would be inbound logistics. Cutting it 
down into lengths forms the operations of AAH. Procurement would be sourcing suppliers 
for the cable, while infrastructure would include the structure of the organisation (i.e. 
centralised purchasing of cable). 
117 B – FALSE 
Differentiation involves making your product stand out from rivals with additional features 
or a stronger brand. This would usually allow you to charge a premium for your product. 
118 A – FOCUS 
H is targeting a niche part of the market and providing goods and services to match its 
needs. 
119 B 
The approach involves breaking the firm down into five ‘primary’ and four ‘support’ 
activities and then looking at each to see if they give a cost advantage or quality advantage. 
 
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P AP E R F 1 ( F A B )
: A CCOU N TAN T IN B US INES S
 
138 
KA P LA N P UBL I SH IN G 
120 B 
The term ‘administration’ indicates that Steve’s role is a support activity, as this term is 
used in the model. The description of his role could only reinforce this conclusion. Likewise, 
‘information technology’ indicates that Sam performs a support role. Finally, although 
Porter’s term ‘procurement’ is not included in the statement, Sunny’s responsibilities for 
dealing with suppliers of inventory and capital equipment are sufficient to conclude that 
Sunny also occupies a support role. 
Note: Instead of applying this process of elimination, candidates could have considered the 
essential differences between primary and support activities, which would have led them to 
the correct conclusion. 
121 A 
It is likely to be a strength. It’s clearly not a weakness or threat and given that is an internal 
issue, it should not be classed as an opportunity – although it may enable AZ to pursue any 
opportunities it identifies.