Exam 11: Strategic Cost Management

A firm that has implemented JIT had the following transactions: - What will be the entry to record material purchases using the backflush approach?

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

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. -After installing JIT, the maintenance cost per roll of 6-inch insulation is

Quickie Company recently implemented a JIT system and is considering implementing a backflush costing system.Following are the transactions for the first quarter of the year. 1.purchased raw materials on account for $375,000 2.all materials were received and placed into production 3.actual labor costs of $75,000 were incurred 4.actual overhead costs of $425,000 were incurred 5.conversion costs of $480,000 were applied to production as conversion costs are recognized quarterly 6.all work was completed for the month 7.all completed work was sold 8.the difference between applied costs and actual costs was determined Required: 1.Prepare journal entries using variation 2 of backflush costing. 2.Prepare journal entries using variation 4 of backflush costing.

_______________ is the time a product exists-from conception to abandonment.

Which of the following is a trait of a traditional manufacturing system?

When a computer company increases the internal storage space for the same price, it is following a

Which of the following is NOT a trait of a traditional manufacturing system?

Courteous 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 12 percent return on sales is required for new products.Because the proposed products did not have a 12 percent return on sales, the products were going to be dropped. Relative to Product BB, Product AA requires more research and development costs but fewer resources to market the product.Sixty-five percent of the research and development costs are traceable to Product AA, and 40 percent of the marketing costs are traceable to Product AA. - If research and development costs and marketing costs are traced to each product, life-cycle income for Product BB would be

A competitive advantage has been established when

A firm that has implemented JIT had the following transactions: Required:

According to the authors, 90 percent or more of a product's life-cycle costs are determined during

The operational activity of assembling parts is an example of a

Identifying profitable and unprofitable customers is an example of exploiting

Which of the following is a trait of a JIT system?

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

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 4-inch insulation before JIT is installed would be

At which stage of the consumable life-cycle is price sensitivity low?

A firm that has implemented JIT had the following transactions: Required:

-If JIT manufacturing is used and each manufacturing cell produces a single product, which of the following is considered a direct product cost?