Exam 11: Strategic Cost Management

There are two general cost management strategies: cost leadership and focusing.

Figure 11-1 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: 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. Refer to Figure 11-1. If 10,000 units are being produced and the sales price is $500, what is the new sales price if the cost savings are passed on to the consumer?

Which of the following manufacturing costs is assigned to products in a traditional environment using driver tracing?

Traditional manufacturing uses which of the following philosophies of quality control?

The time a product exists-from conception to abandonment is called the:

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

The strategy to create better customer value for the same or lower cost than competitors or creating equivalent value for lower cost than offered by competitors is called:

The difference between the sales price needed to capture a predetermined market share and the desired profit per unit is called:

The structural and executional factors that determine the long-term cost structure of an organization are called:

Figure 11-3 Awesome Products Company manufactures a product sold to retailers. It is considering suppliers for its process. The supplier quality involves four activity areas: The following supplier information is given: Refer to Figure 11-3. Which supplier is least costly?

When a computer manufacturing company addresses supplier production problems, it is focusing on

The factors that drive the cost of day-to-day activities performed as a result of the structure and processes selected by the organization are called:

The creation of customer value for same or lower cost than competitors is called __________ advantage.

The total product, the complete range of benefits that a customer receives from a purchased product include(s):

Which of the life-cycle viewpoints is the cost-oriented viewpoint?

In JIT purchasing, materials are usually at warehouse long before they are needed.

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

The stage characterized by preproduction and startup activities is called the:

Ethereal Company sells a product used in many manufacturing processes. The sales activity involves four activity areas: The following customer information is given: Required: What is the profitability of customer B?

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