Cost pre-exam 1

  1. Which of the following statements best define strategy? 



    A. It describes how an organization can create value for its customers while differentiating itself from its competitors.
  2. Which of the following statements best define a product differentiation​ strategy?



    D. It is an​ organization's ability to offer products or services its customers perceive to be superior and unique relative to the products or services of its competitors.
  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?



    B. Cost leadership
  4. An organization that is using the cost leadership approach would​ ________.



    C. focus on productivity through efficiency improvements
  5. Magic Corporation manufactures water toys. It plans to grow by producing​ high-quality water toys that are delivered in a timely manner. There are a number of other manufacturers who produce similar water toys. Magic believes that continuously improving its manufacturing processes and​ re-engineering processes to downsize and eliminate excess capacity are critical to implementing its strategy. Which of the following best describes​ Magic's strategy?  



    B. cost leadership
  6. Which of the following efforts would most likely yield the greatest​ re-engineering benefits?


    B. focusing on entire processes and elimination of unnecessary activities and tasks
  7. The fundamental rethinking and redesign of business processes to achieve improvements in critical measures of​performance, such as​ cost, quality,​ service, speed, and customer satisfaction is​ ________.



    B. reengineering
  8. The first step to successful balanced scorecard implementation is clarifying the​________.



    C. ​organization's vision and strategy
  9. Which of the following statements is true of the​ internal-business-process perspective of a balanced​ scorecard?



    D. ​Internal-business-process improvement targets are often determined after benchmarking against an​ organization's main competitors standards.
  10. Which of the following questions best relates to the balanced​ scorecard's internal business processes​ perspective?



    A. How can our processes be executed in such a way as to increase value to​customers?
  11. A​ company's balanced scorecard measures​yield, order-delivery​ time, cycle​ time, and errors as part of which of the following​perspectives?



    C. ​Internal-business-process
  12. In a strategy​ map, a strategic objective where many ties spur out from it resulting in the achievement of many strategic objectives is​called:



    C. trigger point
  13. Which of the following statements is a disadvantage of balanced​ scorecards?A.Balanced scorecards are of little use in influencing managerial behavior.
    B.Balanced scorecards use a lot of nonfinancial measures.
    C.Balanced scorecards ignore​ short-run objectives.
    D.Balanced scorecards may become unwieldy and difficult to understand.
    D.Balanced scorecards may become unwieldy and difficult to understand.
  14. Which of the following statements is true of strategic analysis of operating​ income? A.Management accountants compare actual operating performance of one year and budgeted operating performance of another year.
    B.Management accountants compare budgeted operating performance over two different periods.
    C.Management accountants compare actual operating performance over two different periods.
    D.Management accountants compare actual and budgeted operating performance over the same time periods.
    C.Management accountants compare actual operating performance over two different periods.
  15. Successful implementation of a product differentiation strategy will result in​ ________.



    B. a large favorable growth and​price-recovery components
  16. Which of the following statements is true of strategic analysis of operating​ income?A.Subdividing the change in operating income to evaluate the success of a strategy has no similarity to the variance analysis.
    B.Management accountants compare actual and budgeted operating performance over the same time periods.
    C.Change in operating income from one period to any future period can be subdivided into product​differentiation, cost​ leadership, and growth components.
    D.It focuses on differences in individual categories of costs​(direct materials, direct manufacturing​ labor, and​overheads).
    C.Change in operating income from one period to any future period can be subdivided into product​differentiation, cost​ leadership, and growth components.
  17. Sunk costs​ ________.



    C. are ignored when evaluating alternatives
  18. When making decisions​ ________.



    A. appropriate weight must be given to both quantitative and qualitative factors
  19. When evaluating a makeminus−orminus−buy ​decision, which of the following needs to be​considered? A.alternative uses of the production capacity 
    B.pension costs to the current employees
    C.material−handling costs that cannot be eliminated
    D.the original cost of the production equipment
    A.alternative uses of the production capacity
  20. Colonial North​ Manufacturing, Inc. is considering eliminating one of its product lines. The fixed costs currently allocated to the product line will be allocated to other product lines upon discontinuance. What financial effects occur if the product line is​discontinued?



    D. net income will decrease by the amount of the contribution margin of the product line being discontinued
  21. Crimson​ Services, Inc., employs 8 individuals. They are all paid​ $16.50 per hour. How would total costs of personnel be​ classified?



    B. variable cost
  22. Which of the following functions represents the least total cost assuming the number of units is equal in each​ case?



    C. y​ = 90​ + 5X
  23. Place the following steps in order for estimating a cost function using quantitative analysis.
    A​ = Plot the data
    B​ = Collect data on the dependent variable and the cost driver.
    C​ = Choose the dependent variable
    D​ = Identify the independent​ variable, or cost driver
    E​ = Estimate the cost function



    A. C D B A E
  24. When using the​ high-low method, the numerator of the equation that determines the slope is the​ ________.



    D. difference between the costs associated with highest and lowest observations of the cost driver
  25. The slope of the line of regression is the​________.



    B. rate at which the dependent variable varies
  26. Which of the following statements is true of​activity-based costing?



    D. There is a clear​ cause-and-effect relationship between costs and the cost driver in the long run.
  27. A step​ variable-cost function​ ________.



    A. is often approximated with a continuous​ variable-cost function
  28. The​ learning-curve models presented in the text examine​ ________.



    C. how efficiency increases as more units are produced
  29. Data collection problems arise when​________.



    B. fixed and variable costs are not separately identified and both are allocated to products on a per unit basis
  30. Which of the following statements is of true engineered​ costs?



    B. They have a​ detailed, physically​observable, and repetitive relationship with output.
  31. Conversion costs are an example of​________.



    A. indirect engineered costs
  32. At the Spring Valley​ Company, the cost of the personnel department has always been charged to production departments based upon number of employees.​ Recently, opinions gathered from the department managers indicate that the number of new hires might be a better predictor of personnel costs. Which cost estimation method is being used by Spring Valley​ Company?



    A. the conference method
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redheadsrockyeah
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336743
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Cost pre-exam 1
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Cost pre-exam 1
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