Exam 11: Strategic Cost Management

_______________ are those factors that drive the cost of day-to-day activities performed as a result of the structure and processes selected by the organization.

The operational activity of moving inventory is classified as a

Prior to installing a JIT system, Clark Company used machine hours to assign maintenance costs to its three products of 4-inch, 6-inch, and 9-inch insulation.The maintenance costs totaled $400,000 per year.The machine hours used by each product and the quantity produced of each product are as follows: After installing JIT, three manufacturing cells were created and the cell workers were trained to perform maintenance.Maintenance costs for the three cells still totaled $400,000; however, these costs are now traceable to each cell. - After installing JIT, the maintenance cost per roll of 4-inch insulation would be

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

The _______________ is a period of time when sales increase at an increasing rate.

Prior to installing a JIT system, Charlotte Company used machine hours to assign maintenance costs to its three products of 4-inch, 6-inch, and 8-inch plastic pipe. The maintenance costs totaled $120,000 per year.The machine hours used by each product and the quantity produced of each product are as follows: After installing JIT, three manufacturing cells were created and the cell workers were trained to perform maintenance.Maintenance costs for the three cells still totaled $120,000; however, these costs are now traceable to each cell. Required:

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

Prior to installing a JIT system, Reilly Company used machine hours to assign maintenance costs to its three products of 4-inch, 6-inch, and 9-inch insulation.The maintenance costs totaled $420,000 per year.The machine hours used by each product and the quantity produced of each product are as follows: After installing JIT, three manufacturing cells were created and the cell workers were trained to perform maintenance.Maintenance costs for the three cells still totaled $420,000; however, these costs are now traceable to each cell. The maintenance cost per roll of 9-inch insulation before JIT is installed would be

If traditional manufacturing is used, which of the following is considered direct costs?

A firm that has implemented JIT had the following transactions: -What will be the entry to record material placed into production using the traditional approach?

Which of the following is NOT a trait of a JIT system?

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

Explain the difference between acceptable quality level and total quality control.

Which of the following manufacturing costs is assigned to products in JIT environment using direct tracing?

Figure 11-1 Clinton 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 $5 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?

Structural and executional activities are types of

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

A firm that has implemented JIT had the following transactions: -Which of the following would NOT be an entry under the backflush system, assuming the second trigger point is the completion of goods?

___________________ is the traditional approach of permitting defects to occur as long as they do NOT exceed a certain level.

Figure 11-4 Brad Company developed the following budgeted life-cycle income statement for two proposed products.Each product's life cycle is expected to be two years. A 10 percent return on sales is required for new products.Because the proposed products did not have a 10 percent return on sales, the products were going to be dropped. Relative to Product B, Product A requires more research and development costs but fewer resources to market the product.Sixty percent of the research and development costs are traceable to Product A, and 30 percent of the marketing costs are traceable to Product A. - Refer to Figure 11-4. Return on sales for Product A would be