Question 1

Which of the following is NOT a discretionary cost?

Accepted Answer

A) the cost of social networking activities to promote a product 
B) the cost of total quality management training for executives 
C) legal costs 
D) the cost to train factory general managers to use a new activity based management system 
A) the cost of social networking activities to promote a product 
B) the cost of total quality management training for executives 
C) legal costs 
D) the cost to train factory general managers to use a new activity based management system

Question 2

Cost effect of productivity for fixed costs is calculated by multiplying the difference in units of capacity (current year capacity units minus the previous year capacity units)by price per unit of capacity of the previous year.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following statements is of true engineered costs?

Accepted Answer

A) They arise from periodic (usually annual)decisions regarding the maximum amount to be incurred. 
B) They have a detailed,physically observable,and repetitive relationship with output. 
C) They include advertising,executive training,and R&D. 
D) They have high level of uncertainty. 
A) They arise from periodic (usually annual)decisions regarding the maximum amount to be incurred. 
B) They have a detailed,physically observable,and repetitive relationship with output. 
C) They include advertising,executive training,and R&D. 
D) They have high level of uncertainty.

Question 4

Which component of strategy measures the changes in operating income attributed solely to an increase in the quantity of output between Year 1 and Year 2?

Accepted Answer

A) the growth component 
B) the price-recovery component 
C) the productivity component 
D) the cost leadership component 
A) the growth component 
B) the price-recovery component 
C) the productivity component 
D) the cost leadership component

Question 5

A company pursuing cost leadership may try to further analyze the change in operating income even when the growth component is highly favorable.Why?

Accepted Answer

A company pursuing cost leadership may t

Question 6

Engineered costs contain a higher level of uncertainty than discretionary costs.

Accepted Answer

A) True 
 B)False

Question 7

Trusted Products Company makes a household appliance with model number L800.The goal for 2018 is to reduce direct materials usage per unit.No defective units are currently produced.Manufacturing conversion costs depend on production capacity defined in terms of L800 units that can be produced.The industry market size for appliances increased 15% from 2017 to 2018.The following additional data are available for 2017 and 2018:
 
What is the revenue effect of the growth component?

Accepted Answer

A) $1,782,000 U 
B) $418,500 F 
C) $418,500 U 
D) $1,782,000 F 
A) $1,782,000 U 
B) $418,500 F 
C) $418,500 U 
D) $1,782,000 F

Question 8

Explain the term cost leadership.What are the possible ways through which a company would try to become a cost leader? How far is it desirable to implement cost reduction measures?

Accepted Answer

Cost leadership is an organization's abi

Question 9

In 2017,Commodity Inc. ,processor of whole grain flour,had the capacity to produce 10,000,000 pounds of product at a conversion cost per pound of $0.20.The conversion cost per pound was $0.15 in 2016 (the previous year).The direct material cost per pound for both years was $0.07 per pound and in 2017,Commodity Inc.produced 9,300,000 pounds while actual production for the previous year was 8,600,000 pounds.What was the cost of unused capacity in 2017?

Accepted Answer

A) $280,000 
B) $140,000 
C) $105,000 
D) $210,000 
A) $280,000 
B) $140,000 
C) $105,000 
D) $210,000

Question 10

Can a company identify unused capacity and,if so,how can unused capacity be managed?

Accepted Answer

It is relatively easy for a company to r

Question 11

Ralph Company has been very aggressive in developing various types of financial and nonfinancial measurement schemes to help with the evaluation of its manufacturing processes.It appears that some of the managers are suboptimizing in that their decision processes are geared solely for their department's benefit,sometimes to the detriment of the organization as a whole.
Required:
What changes in the evaluation system could the company implement to help minimize the suboptimization of the managers' decision-making process?

Accepted Answer

The company could implement a total fact

Question 12

The percentage of processes with real-time feedback would be a measure of which perspective?

Accepted Answer

A) marketing 
B) customer 
C) learning and growth 
D) internal-business-process 
A) marketing 
B) customer 
C) learning and growth 
D) internal-business-process

Question 13

An effective balanced scorecard helps to communicate the strategy to all members of the organization by translating the strategy into a coherent and linked set of understandable and measurable operational targets.

Accepted Answer

A) True 
 B)False

Question 14

The gross margin percentage is an example of the ________ measure of a balanced-scorecard.

Accepted Answer

A) internal business process perspective 
B) customer perspective 
C) learning and growth perspective 
D) financial perspective 
A) internal business process perspective 
B) customer perspective 
C) learning and growth perspective 
D) financial perspective

Question 15

Define engineered and discretionary costs and give two examples of each.

Accepted Answer

An engineered cost results from a cause-

Question 16

Smart Office Systems Inc, (SOSI)a manufacturer of office equipment,in 2017,one of its best years,SOSI sold 1,000,000 units of its YAZ1 calculator for $20 each.In 2016,it sold 930,000 of that same unit for $17.75 each.The cost of the calculator was $16 and $15.00 for 2017 and 2016 respectively.Using the data from 2017 and 2016,what was SOSI's revenue effect of growth?

Accepted Answer

A) $1,242,500 U 
B) $192,500 F 
C) $1,242,500 F 
D) $280,000 U 
A) $1,242,500 U 
B) $192,500 F 
C) $1,242,500 F 
D) $280,000 U

Question 17

Following a strategy of product differentiation,Izzy's Limited Company makes a high-end Appliance,XT15.Izzy's Limited presents the following data for the years 2017 and 2018:
 
Izzy's Limited produces no defective units but it wants to reduce direct materials usage per unit of XT15.Manufacturing conversion costs in each year depend on production capacity defined in terms of XT15 units that can be produced.Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support.Izzy's Limited had 180 customers in 2017 and 185 customers in 2018.
What is the revenue effect of the price-recovery component?

Accepted Answer

A) $3,132,000 U 
B) $1,320,000 U 
C) $1,320,000 F 
D) $3,132,000 F 
A) $3,132,000 U 
B) $1,320,000 U 
C) $1,320,000 F 
D) $3,132,000 F

Question 18

Excellent Mugs Inc.produced 1,600,000 units in 2017 at a units of output per dollar of input cost was $0.09.Its cost of input at 2017 prices that would have been used in 2016 was $20,000,000.How much did the total factor productivity (TFP)increase as a result of 2017 operations?

Accepted Answer

A) about 0.1% 
B) about 12.5% 
C) about 0.08% 
D) about 0.17% 
A) about 0.1% 
B) about 12.5% 
C) about 0.08% 
D) about 0.17%

Question 19

Which of the following involves a fundamental rethinking and redesign of business processes to achieve improvements in critical measures of performance?

Accepted Answer

A) Strategy 
B) Product differentiation 
C) Product designing 
D) Reengineering 
A) Strategy 
B) Product differentiation 
C) Product designing 
D) Reengineering

Question 20

An operating income analysis of Fast Processing Company revealed the following:
 
Fast's operating income gain is consistent with the ________.

Accepted Answer

A) product differentiation strategy 
B) product leadership strategy 
C) cost differentiation strategy 
D) cost leadership strategy 
A) product differentiation strategy 
B) product leadership strategy 
C) cost differentiation strategy 
D) cost leadership strategy

Which of the following is NOT a discretionary cost?

Cost effect of productivity for fixed costs is calculated by multiplying the difference in units of capacity (current year capacity units minus the previous year capacity units)by price per unit of capacity of the previous year.

Which of the following statements is of true engineered costs?

Which component of strategy measures the changes in operating income attributed solely to an increase in the quantity of output between Year 1 and Year 2?

A company pursuing cost leadership may try to further analyze the change in operating income even when the growth component is highly favorable.Why?

Engineered costs contain a higher level of uncertainty than discretionary costs.

Explain the term cost leadership.What are the possible ways through which a company would try to become a cost leader? How far is it desirable to implement cost reduction measures?

Can a company identify unused capacity and,if so,how can unused capacity be managed?

The percentage of processes with real-time feedback would be a measure of which perspective?

An effective balanced scorecard helps to communicate the strategy to all members of the organization by translating the strategy into a coherent and linked set of understandable and measurable operational targets.

The gross margin percentage is an example of the ________ measure of a balanced-scorecard.

Define engineered and discretionary costs and give two examples of each.

Excellent Mugs Inc.produced 1,600,000 units in 2017 at a units of output per dollar of input cost was $0.09.Its cost of input at 2017 prices that would have been used in 2016 was $20,000,000.How much did the total factor productivity (TFP)increase as a result of 2017 operations?

Which of the following involves a fundamental rethinking and redesign of business processes to achieve improvements in critical measures of performance?

An operating income analysis of Fast Processing Company revealed the following: Fast's operating income gain is consistent with the ________.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets,direct-Cost Variances,and Management Control

Flexible Budgets, overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Pricing Decisions and Cost Management

Cost Allocation, customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, just-In-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, transfer Pricing, and Multinational Considerations

Performance Measurement, compensation, and Multinational Considerations

Filters

Exam 12: Strategy,balanced Scorecard,and Strategic Profitability Analysis

Which of the following is NOT a discretionary cost?

Cost effect of productivity for fixed costs is calculated by multiplying the difference in units of capacity (current year capacity units minus the previous year capacity units)by price per unit of capacity of the previous year.

Which of the following statements is of true engineered costs?

Which component of strategy measures the changes in operating income attributed solely to an increase in the quantity of output between Year 1 and Year 2?

A company pursuing cost leadership may try to further analyze the change in operating income even when the growth component is highly favorable.Why?

Engineered costs contain a higher level of uncertainty than discretionary costs.

Explain the term cost leadership.What are the possible ways through which a company would try to become a cost leader? How far is it desirable to implement cost reduction measures?

Can a company identify unused capacity and,if so,how can unused capacity be managed?

The percentage of processes with real-time feedback would be a measure of which perspective?

An effective balanced scorecard helps to communicate the strategy to all members of the organization by translating the strategy into a coherent and linked set of understandable and measurable operational targets.

The gross margin percentage is an example of the ________ measure of a balanced-scorecard.

Define engineered and discretionary costs and give two examples of each.

Excellent Mugs Inc.produced 1,600,000 units in 2017 at a units of output per dollar of input cost was $0.09.Its cost of input at 2017 prices that would have been used in 2016 was $20,000,000.How much did the total factor productivity (TFP)increase as a result of 2017 operations?

Which of the following involves a fundamental rethinking and redesign of business processes to achieve improvements in critical measures of performance?

An operating income analysis of Fast Processing Company revealed the following: Fast's operating income gain is consistent with the ________.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets,direct-Cost Variances,and Management Control

Flexible Budgets, overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Pricing Decisions and Cost Management

Cost Allocation, customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, just-In-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, transfer Pricing, and Multinational Considerations

Performance Measurement, compensation, and Multinational Considerations

Filters