Exam 11: Strategic Cost Management

The viewpoint that describes the general sales pattern of a product as it passes through the introduction, growth, maturity, and decline stages is called the:

Blue Vibrance Company sells a product used in many manufacturing processes. The sales activity involves three activity areas: Activity Area Cost Driver and Rate Order taking \ 100 per purchase order Sales visits \ 50 per visit Delivery vehicles \ 1 per delivery mile The following customer information is given: Units sold 100,000 80,000 60,000 List price \ 50 \ 50 \5 0 Actual sal es price \ 45 \ 48 \5 0 Number of purchase orders 30 20 10 Number of sales visits 6 5 3 Number of delivery miles 100 80 60 Which customer has the least activity costs?

Which of the following is NOT a stage of the production life-cycle viewpoint?

Burgandy Corp. is a manufacturer of equipment used in manufacturing. It currently produces a product with 20 parts. Through redesign, it has reduced the number of parts to 8. The current activity capacity and demand for the 20 unit configuration and expected activity demand for the 8 part configuration are provided below: Activities Activity Driver Activity Capacity Current Activity Demand Expected Activity Demand Materials usage Number of parts 250,000 250,000 100,000 Assembling parts Direct labor hours 15,000 15,000 6,000 Purchasing parts Number of orders 18,000 14,000 7,000 Materials usage has a rate of $5 per part and no fixed costs. Assembly has a rate of $25 per labor hour with no fixed component. Purchasing requires two clerks that can process 2,000 purchase orders. Each clerk earns $33,000 per year. There is also a $2 per order processing cost. What are the savings in materials usage cost with the new design changes?

The relationships among activities that are performed with a firm's portion of the value chain is(are) called:

The difference between what a customer receives and what the customer gives up is called:

According to the authors, 90 percent or more of a product's life-cycle costs are determined during

__________ analysis relies on identifying and exploiting internal and external linkages.

In a JIT environment, many overhead costs are directly traceable to products.

Ambrosia Corp. is a manufacturer of equipment used in manufacturing. It currently produces a product with 30 parts but through redesign has reduced the number of parts to 9. Then current activity capacity and demand for the 30 unit configuration and expected activity demand for the 9 part configuration are provided below: Activities Activity Activity Current Expected Driver Capacity Activity Demand Activity Demand Materials pumber of uarts 300,000 300,000 90,000 Assembly direct labor hours 20,000 20,000 6,000 Purchasing parts orders of 20,000 16,000 8,000 Materials usage has a rate of $6 per part and no fixed costs. Assembly has a rate of $20 per labor hour with no fixed component. Purchasing requires clerks that can process 5,000 purchase orders. Each clerk earns $40,000 per year. There is also a $1 per order processing cost. What is the total cost reduction of the new design?

Which stage of the marketing life-cycle has slow sales growth with peak sales?

The operational activity of moving inventory is classified as a

A major difference between traditional and JIT environments is the degree of responsibility given to workers in the organization.

the difference between what the customer receives and gives up is the __________ .

Choosing alternative strategies that provide long-term growth involves __________ decision making.

The objective of strategic cost management is to reduce costs while strengthening strategic positions.

Which of the following strategies strives to increase customer value by increasing customer realization?

In traditional and JIT environments using direct tracing, the manufacturing costs assigned to products are the direct materials costs and the __________ costs.

Which viewpoint of the product life-cycle is customer-value oriented?

Life-cycle cost management consists of