Question 1

Manufacturing overhead cost is an example of indirect engineered costs.

Accepted Answer

A) True 
 B)False

Question 2

Bosely Corporation is reviewing its business strategy.The first step for Bosely is to perform an industry analysis.You have been hired to help the company go through the strategy formulation process.
Required:
To perform the industry analysis,what areas should Bosely focus on and give at least one example of how Bosely can effectively deal with each area.

Accepted Answer

The answer of Bosely Corporation is reviewing its business strategy.The...

Question 3

What is the term for an organization's ability to achieve lower costs relative to competitors through productivity and efficiency improvements,elimination of waste,and tight cost control?

Accepted Answer

A) Marketing strategy 
B) Product differentiation 
C) Cost leadership 
D) Competitor differentiation

Question 4

________ measures the relationship between actual inputs used and actual outputs achieved.

Accepted Answer

A) Strategy map 
B) Planning variance 
C) Productivity 
D) Discretionary costs

Question 5

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 160 customers in 2017 and 165 customers in 2018.
What is the cost effect of the growth component? (Round any intermediary calculations to two decimals and your final answer to the nearest dollar. )

Accepted Answer

A) $280,500 U 
B) $1,449,700 U 
C) $1,449,700 F 
D) $280,500 F

Question 6

Strategic Analysis of Profitability of King Philip Company:

What is the revenue effect of the productivity component (b)?

Accepted Answer

A) $0 
B) $2600 U 
C) $1200 F 
D) $2600 F

Question 7

Partial productivity multiplied by the quantity of input used results in ________.

Accepted Answer

A) expected production 
B) budgeted output 
C) actual output 
D) a ratio

Question 8

Which of the following focuses on these five factors: competitors,potential entrants to the market,equivalent products,bargaining power of customers,and bargaining power of suppliers?

Accepted Answer

A) balanced scorecard 
B) product differentiation analysis 
C) industry analysis 
D) business process reengineering

Question 9

What is the term that describes an organization's ability to offer products or services that are perceived by its customers as being superior and unique relative to those of its competitors?

Accepted Answer

A) Strategy 
B) Product differentiation 
C) Cost leadership 
D) The balanced scorecard

Question 10

Davis Company produced 216,000 sport jackets during 2015 and 540,000 direct manufacturing labor-hours were used at $2 per hour.The conversion costs were $1.20 per jackets produced.
What is the direct manufacturing labor partial productivity for Davis Company?

Accepted Answer

A) 0)40 unit per direct manufacturing labor-hour 
B) 0)60 unit per direct manufacturing labor-hour 
C) 2)50 unit per direct manufacturing labor-hour 
D) 1)00 unit per direct manufacturing labor-hour

Question 11

The lower the inputs for a given set of outputs or the higher the outputs for a given set of inputs,the higher the level of ________.

Accepted Answer

A) overallocation 
B) expenditure 
C) productivity 
D) labor costs

Question 12

In an effective balanced scorecard,________.

Accepted Answer

A) net income serves as the best indicator for the hard-to measure long-run operational performance 
B) the sales budget serves as one of the leading indicator for the hard-to measure short-run financial performance 
C) the sales budget serves as a leading indicator for the hard-to measure short-run nonfinancial performance 
D) customer satisfaction serves as one of the leading indicator for the hard-to measure long-run financial performance such as the likelihood of higher sales and income

Question 13

Higher selling prices,rather than unique products or services,provide a competitive advantage for the cost leader companies.

Accepted Answer

A) True 
 B)False

Question 14

identifying unused capacity for R&D costs is relatively easy once the impact of downsizing is estimated for engineered costs.

Accepted Answer

A) True 
 B)False

Question 15

Stewart Corporation plans to grow by offering a sound system,the SS3000,that is superior and unique from the competition.Stewart believes that putting additional resources into R&D and staying ahead of the competition with technological innovations is critical to implementing its strategy.Which of the following terms best describes Stewart's strategy?

Accepted Answer

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

Question 16

BarGraphs Corp.had capacity to produce 12,000 units of L3 using 30,000 kg of direct materials.BarGraphs produced 11,650 units of L3 by processing 25,500 kg of direct materials.Conversion cost per unit is $7.50.BarGraphs can add or reduce manufacturing capacity in increments of 4500 kgs.
What is the cost of unused capacity for conversion costs of BarGraphs?

Accepted Answer

A) $3000 
B) $4500 
C) $13,500 
D) $2625

Question 17

To achieve success,it is important to set nonfinancial objectives as well as financial objectives.

Accepted Answer

A) True 
 B)False

Question 18

Cobalt Company makes a household appliance with model number X500.The goal for 2018 is to improve product design and outlook.No defective units are currently produced.Manufacturing conversion costs depend on production capacity defined in terms of X500 units that can be produced.The industry market size for appliances increased 10% from 2017 to 2018.The following additional data are available for 2017 and 2018:

Out of the two basic strategies,Cobalt's strategy is ________.

Accepted Answer

A) product differentiation because Cobalt is able to produce a given quantity of output with a lower cost of inputs 
B) cost leadership because Cobalt is able to produce a given quantity of output with a lower cost of inputs 
C) cost leadership because Cobalt is able to increase its output price faster than the increase in its input prices 
D) product differentiation because Cobalt is able to increase its output price faster than the increase in its input prices

Question 19

Successful implementation of a product differentiation strategy will result in ________.

Accepted Answer

A) a large favorable growth and price-recovery components 
B) a large favorable price-recovery and productivity components 
C) a large favorable productivity and growth components 
D) only a large favorable growth component

Question 20

Foley Products Company makes a household appliance with model number X500.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 X500 units that can be produced.The industry market size for appliances increased 10% from 2017 to 2018.The following additional data are available for 2017 and 2018:

What is operating income for 2018?

Accepted Answer

A) $1,716,000 
B) $1,127,200 
C) $889,900 
D) $875,200

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

Manufacturing overhead cost is an example of indirect engineered costs.

What is the term for an organization's ability to achieve lower costs relative to competitors through productivity and efficiency improvements,elimination of waste,and tight cost control?

________ measures the relationship between actual inputs used and actual outputs achieved.

Strategic Analysis of Profitability of King Philip Company: What is the revenue effect of the productivity component (b) ?

Partial productivity multiplied by the quantity of input used results in ________.

Which of the following focuses on these five factors: competitors,potential entrants to the market,equivalent products,bargaining power of customers,and bargaining power of suppliers?

What is the term that describes an organization's ability to offer products or services that are perceived by its customers as being superior and unique relative to those of its competitors?

Davis Company produced 216,000 sport jackets during 2015 and 540,000 direct manufacturing labor-hours were used at $2 per hour.The conversion costs were $1.20 per jackets produced. What is the direct manufacturing labor partial productivity for Davis Company?

The lower the inputs for a given set of outputs or the higher the outputs for a given set of inputs,the higher the level of ________.

In an effective balanced scorecard,________.

Higher selling prices,rather than unique products or services,provide a competitive advantage for the cost leader companies.

identifying unused capacity for R&D costs is relatively easy once the impact of downsizing is estimated for engineered costs.

To achieve success,it is important to set nonfinancial objectives as well as financial objectives.

Successful implementation of a product differentiation strategy will result in ________.