Exam 18: Strategic Performance Measurement: Cost Centers, Profit Centers, and the Balanced Scorecard

The need for coordination between the production and the selling function will impact the choice of:

What is an appropriate performance evaluation measure for the mature stage of a product's life cycle?

Which of the following is not an important formal management control system at the individual employee level?

By not distinguishing between direct and indirect costs in their performance reporting, many companies:

The evaluation by upper-level managers of the performance of mid-level managers is:

The cost method that is input-oriented and considers costs largely uncontrollable at the planning stage is called the:

In a not-for-profit organization, you are more likely to see

During October, Rover Industries produced 35,000 units of product with costs as follows: Direct materials \8 4,000 Direct labor 43,000 Variable overhead 13,000 Fixed overhead 147,000 What is Rover's unit cost for October, calculated on the variable costing basis?

The most relevant factor in deciding how or which costs should be assigned to an SBU is the degree of:

Organic Laboratories allocates research and development costs to its three research facilities based on each facility's total annual revenue from new product developments: Facility location Kentucky Arizona Illinois Total New product revenue \5 6,000,000 \1 00,000,000 \8 4,000,000 \2 40,000,000 Research \& ( Development \6 0,000,000 Using revenue as an allocation base, the amount of costs allocated to the Kentucky research facility is calculated to be:

Brantley Inc. manufactures calculators that sell at wholesale for $60.00 per unit. Budgeted production in both 2018 and 2019 was 2,000 units and budgeted fixed overhead was $25,000 in each year. There was no beginning inventory in 2018. The following data summarized the 2018 and 2019 operations: 2018 2019 Units sold 1,900 2,100 Units produced 2,000 2,000 Costs: Variable factory overhead per unit \ 20.20 \ 20.20 Fixed factory overhead \ 25,000 \ 25,000 Variable marketing per unit \ 2.00 \2 .00 Fixed Selling and Administrative \ 10,000 \ 10,000 Required: Determine income under both full costing and variable costing and explain the difference.

A model that has been used to better understand the key elements that contracts must have in order to achieve the desired objectives is:

Managers who are risk averse:

A unit of an organization is referred to as a profit center if it has:

In a formal management control system, top management sets expectations for desired manager performance. Which of the following is not one of the areas in which a formal individual management control system would be used?

The main concept of the balanced scorecard is that, to evaluate the SBU's progress to strategic success, an organization must use all of the following except:

Other things being equal, income computed by the variable costing method will exceed that computed by the full costing method if:

A value stream is:

"Outsourcing" a cost center is often done to:

Sand and Sea Resorts owns and operates two resorts in a coastal town. Both resorts are located on a barrier island that is connected to the mainland by a high bridge. One resort is located on the beach and is called the Crystal Coast Resort. The other resort is located on the inland waterway which passes between the town and the mainland; it is called the Harborview Resort. Some key information about the two resorts for the current year is shown below. Harborview Crystal Coast Total Revenue (000) \ 3,500 \ 6,500 \ 10,000 Square feet 75,000 225,000 300,000 Rooms 60 140 200 Assets (000) \ 100,000 \ 400,000 \ 500,000 The nontraceable operating costs of the resort amount to $\$ 4,000,000$ . By careful study, the management accountant at Sand and Sea has determined that, while the costs are not directly traceable, the total of $\$ 4$ million could be fairly allocated to the four cost drivers as follows. Cost Driver Amount Allocated Revenue \ 200,000 Square feet 100,000 Rooms 600,000 Assets (000) 3,100,000 Determine the amount of nontraceable cost to be allocated to the Harborview Resort using revenue as an allocation base.