Question 1

Fluctuations in exchange rates between different countries' currencies never affect costs and pricing decisions.

Accepted Answer

A) True 
 B)False

Question 2

A customer cost hierarchy categorizes costs related to customers into different cost pools on the basis of different types of cost drivers,or cost allocation bases,or different degrees of difficulty determining cause-and-effect or benefits-received relationships.

Accepted Answer

A) True 
 B)False

Question 3

Value engineering decreases both value-added costs and non-value-added costs.

Accepted Answer

A) True 
 B)False

Question 4

________ tracks and accumulates business function costs across the entire value chain from a product's initial R&D to its final customer service and support.

Accepted Answer

A) Product life cycle 
B) Life-cycle budgeting 
C) Customer life-cycle costs 
D) Life-cycle costing 
E) Price discrimination 
A) Product life cycle 
B) Life-cycle budgeting 
C) Customer life-cycle costs 
D) Life-cycle costing 
E) Price discrimination

Question 5

Which category of indirect costs in the customer-cost hierarchy are costs incurred to process orders or to make deliveries?

Accepted Answer

A) Customer output unit-level costs. 
B) Customer batch-level costs. 
C) Customer-sustaining costs. 
D) Distribution-channel costs. 
E) Corporate-division-sustaining costs. 
A) Customer output unit-level costs. 
B) Customer batch-level costs. 
C) Customer-sustaining costs. 
D) Distribution-channel costs. 
E) Corporate-division-sustaining costs.

Question 6

Target annual operating income divided by invested capital is ________.

Accepted Answer

A) target price 
B) locked in costs 
C) target cost per unit 
D) target operating income per unit 
E) target rate of return on investment 
A) target price 
B) locked in costs 
C) target cost per unit 
D) target operating income per unit 
E) target rate of return on investment

Question 7

A non-value-added-cost is a cost that,if eliminated,would reduce the actual or perceived value or utility that customers gain from using the product or service.

Accepted Answer

A) True 
 B)False

Question 8

In life-cycle budgeting,managers estimate the revenues and business function costs across the entire value chain from a product's initial R&D to its final customer service and support.

Accepted Answer

A) True 
 B)False

Question 9

Do service companies use cost-plus pricing?

Accepted Answer

Service companies use a cost-plus pricin

Question 10

What is meant by the term reverse engineer?

Accepted Answer

When companies reverse engineer,they dis

Question 11

Tracking price discounts by customer and by salesperson has no impact on customer profitability.

Accepted Answer

A) True 
 B)False

Question 12

Budgeted life-cycle costs provide useful information for strategically evaluating pricing decisions.

Accepted Answer

A) True 
 B)False

Question 13

A systematic evaluation of all aspects of the value chain,with the objective of reducing costs and achieving a quality level that satisfies customers is ________.

Accepted Answer

A) cost engineering 
B) price engineering 
C) value engineering 
D) product engineering 
E) promotion engineering 
A) cost engineering 
B) price engineering 
C) value engineering 
D) product engineering 
E) promotion engineering

Question 14

Mark Manufacturing had a product design that resulted in a $740 full cost of Product B.Assuming a markup of 10%,what is the prospective price of Product B?

Accepted Answer

A) $800 
B) $804 
C) $814 
D) $824 
E) $834 
A) $800 
B) $804 
C) $814 
D) $824 
E) $834

Question 15

Which of the following is true about costs?

Accepted Answer

A) Costs never influence prices because they do not affect supply. 
B) The higher the cost of producing the product,the greater the quantity supplied. 
C) As companies increase supply,the cost of producing the product initially declines but eventually increases. 
D) Managers set prices to maximize profits and they do not set prices that make the products attractive to consumers. 
E) Companies supply products as long as selling additional units is lower than the cost to produce those products. 
A) Costs never influence prices because they do not affect supply. 
B) The higher the cost of producing the product,the greater the quantity supplied. 
C) As companies increase supply,the cost of producing the product initially declines but eventually increases. 
D) Managers set prices to maximize profits and they do not set prices that make the products attractive to consumers. 
E) Companies supply products as long as selling additional units is lower than the cost to produce those products.

Question 16

Companies in the United States are fee to charge whatever price they like.

Accepted Answer

A) True 
 B)False

Question 17

Collusive pricing occurs when companies in an industry conspire in their pricing and production decisions to achieve a price above the competitive price and so restrain trade.

Accepted Answer

A) True 
 B)False

Question 18

________ focus on total costs incurred by a customer to acquire,use,maintain,and dispose of a product or service.

Accepted Answer

A) Product life-cycle 
B) Life-cycle budgeting 
C) Customer life-cycle costs 
D) Life-cycle costing 
E) Price discrimination 
A) Product life-cycle 
B) Life-cycle budgeting 
C) Customer life-cycle costs 
D) Life-cycle costing 
E) Price discrimination

Question 19

Market-based pricing starts with:

Accepted Answer

A) target price. 
B) listing price. 
C) selling price. 
D) strategic price. 
E) consumer price. 
A) target price. 
B) listing price. 
C) selling price. 
D) strategic price. 
E) consumer price.

Question 20

What are the first three categories of the customer-cost hierarchy? Why do managers want to analyze customer-level indirect costs?

Accepted Answer

The first three categories of the custom

Fluctuations in exchange rates between different countries' currencies never affect costs and pricing decisions.

A customer cost hierarchy categorizes costs related to customers into different cost pools on the basis of different types of cost drivers,or cost allocation bases,or different degrees of difficulty determining cause-and-effect or benefits-received relationships.

Value engineering decreases both value-added costs and non-value-added costs.

________ tracks and accumulates business function costs across the entire value chain from a product's initial R&D to its final customer service and support.

Which category of indirect costs in the customer-cost hierarchy are costs incurred to process orders or to make deliveries?

Target annual operating income divided by invested capital is ________.

A non-value-added-cost is a cost that,if eliminated,would reduce the actual or perceived value or utility that customers gain from using the product or service.

In life-cycle budgeting,managers estimate the revenues and business function costs across the entire value chain from a product's initial R&D to its final customer service and support.

Do service companies use cost-plus pricing?

What is meant by the term reverse engineer?

Tracking price discounts by customer and by salesperson has no impact on customer profitability.

Budgeted life-cycle costs provide useful information for strategically evaluating pricing decisions.

A systematic evaluation of all aspects of the value chain,with the objective of reducing costs and achieving a quality level that satisfies customers is ________.

Mark Manufacturing had a product design that resulted in a $740 full cost of Product B.Assuming a markup of 10%,what is the prospective price of Product B?

Which of the following is true about costs?

Companies in the United States are fee to charge whatever price they like.

Collusive pricing occurs when companies in an industry conspire in their pricing and production decisions to achieve a price above the competitive price and so restrain trade.

________ focus on total costs incurred by a customer to acquire,use,maintain,and dispose of a product or service.

Market-based pricing starts with:

What are the first three categories of the customer-cost hierarchy? Why do managers want to analyze customer-level indirect costs?

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Process Costing and Cost Allocation

Activity-Based Costing and Activity-Based Management

Determining How Costs Behave

Decision Making and Relevant Information

Quality, inventory Management, and Time

Capital Investments

Master Budget and Responsibility Accounting

Flexible Budgets, cost Variances, and Management Control

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Transfer Pricing

Performance Measurement and Compensation

Filters

Exam 7: Pricing Decisions, customer Profitability, and Cost Management

Fluctuations in exchange rates between different countries' currencies never affect costs and pricing decisions.

A customer cost hierarchy categorizes costs related to customers into different cost pools on the basis of different types of cost drivers,or cost allocation bases,or different degrees of difficulty determining cause-and-effect or benefits-received relationships.

Value engineering decreases both value-added costs and non-value-added costs.

________ tracks and accumulates business function costs across the entire value chain from a product's initial R&D to its final customer service and support.

Which category of indirect costs in the customer-cost hierarchy are costs incurred to process orders or to make deliveries?

Target annual operating income divided by invested capital is ________.

A non-value-added-cost is a cost that,if eliminated,would reduce the actual or perceived value or utility that customers gain from using the product or service.

In life-cycle budgeting,managers estimate the revenues and business function costs across the entire value chain from a product's initial R&D to its final customer service and support.

Do service companies use cost-plus pricing?

What is meant by the term reverse engineer?

Tracking price discounts by customer and by salesperson has no impact on customer profitability.

Budgeted life-cycle costs provide useful information for strategically evaluating pricing decisions.

A systematic evaluation of all aspects of the value chain,with the objective of reducing costs and achieving a quality level that satisfies customers is ________.

Mark Manufacturing had a product design that resulted in a $740 full cost of Product B.Assuming a markup of 10%,what is the prospective price of Product B?

Which of the following is true about costs?

Companies in the United States are fee to charge whatever price they like.

Collusive pricing occurs when companies in an industry conspire in their pricing and production decisions to achieve a price above the competitive price and so restrain trade.

________ focus on total costs incurred by a customer to acquire,use,maintain,and dispose of a product or service.

Market-based pricing starts with:

What are the first three categories of the customer-cost hierarchy? Why do managers want to analyze customer-level indirect costs?

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Process Costing and Cost Allocation

Activity-Based Costing and Activity-Based Management

Determining How Costs Behave

Decision Making and Relevant Information

Quality, inventory Management, and Time

Capital Investments

Master Budget and Responsibility Accounting

Flexible Budgets, cost Variances, and Management Control

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Transfer Pricing

Performance Measurement and Compensation

Filters