Question 1

Which of the following phases are included in the sales life cycle?

Accepted Answer

A) Option A 
B) Option B 
C) Option C 
D) Option D 
A) Option A 
B) Option B 
C) Option C 
D) Option D

Question 2

During the sales life cycle, which is an example of what happens during the growth phase?

Accepted Answer

A) Sales and price decline, as do the number of competitors. 
B) Sales continue to increase but at a decreasing rate. The number of competitors and product variety decline. 
C) Sales increase rapidly along with an increase in product variety. 
D) Sales rise slowly as customers become aware of the new product or service. Product variety is limited. 
A) Sales and price decline, as do the number of competitors. 
B) Sales continue to increase but at a decreasing rate. The number of competitors and product variety decline. 
C) Sales increase rapidly along with an increase in product variety. 
D) Sales rise slowly as customers become aware of the new product or service. Product variety is limited.

Question 3

In order to reduce costs so as to reach the desired target cost, Quality Industries should also focus on reducing the cost of:

Accepted Answer

A) Direct materials 
B) Direct labor 
C) Machine setups 
D) Mechanical assembly 
A) Direct materials 
B) Direct labor 
C) Machine setups 
D) Mechanical assembly

Question 4

Which of the following is the speed at which units must be manufactured to meet customer demand?

Accepted Answer

A) Production time. 
B) Manufacturing time. 
C) Takt time. 
D) Throughput time. 
A) Production time. 
B) Manufacturing time. 
C) Takt time. 
D) Throughput time.

Question 5

The management accountant at Iang Manufacturing Co. collected the following data in preparation for a life-cycle analysis on one of its products, a leaf blower:   The stage of the sales life cycle the product is in is:

Accepted Answer

A) Introduction. 
B) Growth. 
C) Maturity. 
D) Decline. 
E) Withdrawal. 
A) Introduction. 
B) Growth. 
C) Maturity. 
D) Decline. 
E) Withdrawal.

Question 6

Bakker Industries sells three products (611, 613, and 615) that it manufactures in four departments. Both labor and machine time are applied to products in each of the four departments. The machine-processing and labor skills required in each department prohibit switching either machines or labor from one department to another. However, Bakker has a good supply of both full-time and part-time labor and does not expect hiring or retention of employees to be a problem. Because of the availability of part-time labor, Bakker considers labor a variable cost and includes it in the calculation of throughput margin.
Bakker's management is planning its production schedule for the next several months. Some machines will be out of service for extensive overhauling. Available machine times by department for each of the next six months are as follows:   Labor and machine specifications per unit of product are as follows:   The Sales Department's forecast of product demand over the next six months is as follows:   Bakker's inventory levels will not increase or decrease during the next six months. The unit price and cost data valid for the coming six months are as follows:   Required:
1. Determine whether Bakker can meet the monthly sales demand for the three products. What department, if any, is a constraint?
2. What monthly production schedule would be best for Bakker Industries?

Accepted Answer

Answer may vary
Feedback: 1. Bakker will

Question 7

The current cost per unit is:

Accepted Answer

A) $250. 
B) $300. 
C) $400. 
D) $450. 
E) $475. 
A) $250. 
B) $300. 
C) $400. 
D) $450. 
E) $475.

Question 8

The current profit per unit is:

Accepted Answer

A) $503. 
B) $674. 
C) $616. 
D) $524. 
E) $694. 
A) $503. 
B) $674. 
C) $616. 
D) $524. 
E) $694.

Question 9

Which one of the following is true concerning TOC?

Accepted Answer

A) Option A 
B) Option B 
C) Option C 
D) Option D 
E) Option E 
A) Option A 
B) Option B 
C) Option C 
D) Option D 
E) Option E

Question 10

Which of the following is a common form of value engineering in which the design team prepares several possible designs of the product, each having similar features with different levels of performance and different costs?

Accepted Answer

A) Cost analysis. 
B) Variable design engineering. 
C) Cost-based value engineering. 
D) Functional analysis. 
E) Design analysis. 
A) Cost analysis. 
B) Variable design engineering. 
C) Cost-based value engineering. 
D) Functional analysis. 
E) Design analysis.

Question 11

The sequence of phases in the product or service's life in the market - from the introduction of the product or service to the growth in sales and finally maturity, decline, and withdrawal from the market is the:

Accepted Answer

A) Sales life cycle. 
B) Target life cycle. 
C) Market life cycle. 
D) Critical life cycle. 
E) Cost life cycle. 
A) Sales life cycle. 
B) Target life cycle. 
C) Market life cycle. 
D) Critical life cycle. 
E) Cost life cycle.

Question 12

The five tasks that follow take place with the concept known as target costing: 1. Use value engineering to identify ways to reduce product cost.
2) Determine the market price.
3) Determine the desired profit.
4) Use kaizen costing and operational control to reduce costs.
5) Calculate the target cost at market price less desired profit.
Which of the following choices depicts the correct sequence of these tasks?

Accepted Answer

A) 1, 2, 3, 4, 5 
B) 2, 3, 5, 1, 4 
C) 3, 2, 5, 4, 1 
D) 3, 2, 5, 1, 4 
E) 5, 3, 2, 4, 1 
A) 1, 2, 3, 4, 5 
B) 2, 3, 5, 1, 4 
C) 3, 2, 5, 4, 1 
D) 3, 2, 5, 1, 4 
E) 5, 3, 2, 4, 1

Question 13

Which one of the following is not one of the five steps in TOC analysis?

Accepted Answer

A) Identify the binding constraint(s). 
B) Determine the most efficient utilization for each binding constraint. 
C) Manage the flow through the binding constraint. 
D) Identify those responsible for bottlenecks and make adjustments as needed. 
E) Redesign the manufacturing process for flexibility and fast throughput. 
A) Identify the binding constraint(s). 
B) Determine the most efficient utilization for each binding constraint. 
C) Manage the flow through the binding constraint. 
D) Identify those responsible for bottlenecks and make adjustments as needed. 
E) Redesign the manufacturing process for flexibility and fast throughput.

Question 14

Many firms choose to achieve target cost through redesign of the product or service because they recognize that design decisions:

Accepted Answer

A) Are life cycle costs with high downstream costs and benefits. 
B) Account for much of the total product life cycle costs. 
C) Impact costs at the manufacturing stage of the life cycle. 
D) Are critical success factors in most firms. 
A) Are life cycle costs with high downstream costs and benefits. 
B) Account for much of the total product life cycle costs. 
C) Impact costs at the manufacturing stage of the life cycle. 
D) Are critical success factors in most firms.

Question 15

Required:
1. Calculate the current cost and profit per unit.
2. How much of the current cost per unit is attributable to non-value added activities?
3. Calculate the new target cost per unit for a sales price of $400 if the profit per unit is maintained.
4. What strategy do you suggest for Warrenton to attain the target cost calculated in part (3)?Warrenton Industries manufactures hydraulic components for large automated machine tools. Myles English, the Vice President for Marketing, has concluded from his market analysis that sales are dwindling for one of the firm's products main products, a hydraulic valve, because of aggressive pricing by competitors. Warrenton's product sells for $525 whereas the competition's comparable part is selling in the $425 range. Mr. English has determined that a price drop to $400 is necessary to regain market share and annual sales of 1,000 units.
Cost data based on sales of 1,000 valves:

Accepted Answer

Answer may vary
Feedback: 1. cost per un

Question 16

Marchand's Restaurant had developed an excellent reputation in recent years for its price, menu, and atmosphere. The restaurant is now completing a strategic analysis to determine whether it should make adjustments in its menu, pricing, or wait service, to better meet customer needs and to become more competitive. Marchand's has chosen to use Quality Function Deployment (QFD) to analyze customer preferences and its cost structure. The analysis focuses on costs that can be managed in the short term, and therefore excludes facility related costs.
The data that Marchand's has collected so far includes information about customer preferences (Marchand's surveyed customers regarding their preferences for taste, comfort and atmosphere) and the unit cost of the three key elements of its service: food preparation, wait staff, and food ingredients.   Next, Marchand completed an analysis, using the expertise of its managers, wait staff and kitchen staff, to determine the contribution of each of the three elements of its service to satisfying the three components of customer satisfaction.   Required:
Determine which of the three cost elements (food preparation, wait staff, and food ingredients) should be given increased or decreased emphasis based on a QFD analysis. Explain your answer with appropriate calculations.

Accepted Answer

Answer may vary
Feedback: @#IMG-DLM& Marchand's sh

Question 17

Caldwell Company desires to enter a market with a new product. As part of this process the following tasks will be performed: 1. Determine a desired profit margin.
2) Use Kaizen costing.
3) Design and engineer the product.
4) Determine the product's cost.
5) Determine the suggested selling price.
Which task would Caldwell Company perform first if it plans to use target costing?

Accepted Answer

A) Determine a desired profit margin. 
B) Use Kaizen costing. 
C) Design and engineer the product. 
D) Determine the product's cost. 
E) Determine the suggested selling price. 
A) Determine a desired profit margin. 
B) Use Kaizen costing. 
C) Design and engineer the product. 
D) Determine the product's cost. 
E) Determine the suggested selling price.

Question 18

Cling Co. produces and sells three products (X, Y, and Z). The following data relate to the three products. Labor is a fixed cost.   Required:
1. Which is the most profitable product if there is no labor constraint?
2. Which is the most profitable product if there is a labor constraint?

Accepted Answer

Answer may vary
Feedback: 1. C

Question 19

TwoShaft Inc. manufactures a wide variety of parts for recreational boating, including boat engines. The component is purchased by OEM (Original Equipment Manufacturers) such as Mercury and Honda, for use in the larger and more powerful outboards. The units sell for $660, and sales volume averages 32,000 units per year. Recently, TwoShaft's major competitor lowered the price of the equivalent part to $590. The market was very competitive, and TwoShaft realized it had to meet the new price or lose significant market share. The controller assembled the following data for the most recent year:   The target cost for maintaining current market share and profitability is (round to nearest cent):

Accepted Answer

A) $466.61. 
B) $417.12. 
C) $396.61. 
D) $390.61. 
E) $460.61. 
A) $466.61. 
B) $417.12. 
C) $396.61. 
D) $390.61. 
E) $460.61.

Question 20

Henry Ford was an early pioneer in the use of:

Accepted Answer

A) the theory of constraints. 
B) target costing. 
C) life cycle costing. 
D) just-in-time manufacturing. 
A) the theory of constraints. 
B) target costing. 
C) life cycle costing. 
D) just-in-time manufacturing.

Which of the following phases are included in the sales life cycle?

During the sales life cycle, which is an example of what happens during the growth phase?

In order to reduce costs so as to reach the desired target cost, Quality Industries should also focus on reducing the cost of:

Which of the following is the speed at which units must be manufactured to meet customer demand?

The management accountant at Iang Manufacturing Co. collected the following data in preparation for a life-cycle analysis on one of its products, a leaf blower: The stage of the sales life cycle the product is in is:

The current cost per unit is:

The current profit per unit is:

Which one of the following is true concerning TOC?

Which of the following is a common form of value engineering in which the design team prepares several possible designs of the product, each having similar features with different levels of performance and different costs?

The sequence of phases in the product or service's life in the market - from the introduction of the product or service to the growth in sales and finally maturity, decline, and withdrawal from the market is the:

Which one of the following is not one of the five steps in TOC analysis?

Many firms choose to achieve target cost through redesign of the product or service because they recognize that design decisions:

Cling Co. produces and sells three products (X, Y, and Z). The following data relate to the three products. Labor is a fixed cost. Required: 1. Which is the most profitable product if there is no labor constraint? 2. Which is the most profitable product if there is a labor constraint?

Henry Ford was an early pioneer in the use of:

Cost Management and Strategy

Implementing Strategy: the Value Chain, the Balanced Scorecard, and the Strategy Map

Basic Cost Management Concepts

Job Costing

Activity-Based Costing and Customer Profitability Analysis

Process Costing

Cost Allocation: Departments, Joint Products, and By-Products

Cost Estimation

Short-Term Profit Planning: Cost-Volume-Profit Cvp Analysis

Strategy and the Master Budget

Decision Making With a Strategic Emphasis

Strategy and the Analysis of Capital Investments

Operational Performance Measurement: Sales, Direct-Cost Variances, and the Role of Nonfinancial Performance Measures

Operational Performance Measurement: Indirect-Cost Variances and Resource-Capacity Management

Operational Performance Measurement: Further Analysis of Productivity and Sales

The Management and Control of Quality

Strategic Performance Measurement: Cost Centers, Profit Centers, and the Balanced Scorecard

Strategic Performance Measurement: Investment Centers and Transfer Pricing

Management Compensation, Business Analysis, and Business Valuation

Filters

Exam 13: Cost Planning for the Product Life Cycle: Target Costing, Theory of Constraints, and Strategic Pricing

Which of the following phases are included in the sales life cycle?

During the sales life cycle, which is an example of what happens during the growth phase?

In order to reduce costs so as to reach the desired target cost, Quality Industries should also focus on reducing the cost of:

Which of the following is the speed at which units must be manufactured to meet customer demand?

The management accountant at Iang Manufacturing Co. collected the following data in preparation for a life-cycle analysis on one of its products, a leaf blower: The stage of the sales life cycle the product is in is:

The current cost per unit is:

The current profit per unit is:

Which one of the following is true concerning TOC?

Which of the following is a common form of value engineering in which the design team prepares several possible designs of the product, each having similar features with different levels of performance and different costs?

The sequence of phases in the product or service's life in the market - from the introduction of the product or service to the growth in sales and finally maturity, decline, and withdrawal from the market is the:

Which one of the following is not one of the five steps in TOC analysis?

Many firms choose to achieve target cost through redesign of the product or service because they recognize that design decisions:

Cling Co. produces and sells three products (X, Y, and Z). The following data relate to the three products. Labor is a fixed cost. Required: 1. Which is the most profitable product if there is no labor constraint? 2. Which is the most profitable product if there is a labor constraint?

Henry Ford was an early pioneer in the use of:

Cost Management and Strategy

Implementing Strategy: the Value Chain, the Balanced Scorecard, and the Strategy Map

Basic Cost Management Concepts

Job Costing

Activity-Based Costing and Customer Profitability Analysis

Process Costing

Cost Allocation: Departments, Joint Products, and By-Products

Cost Estimation

Short-Term Profit Planning: Cost-Volume-Profit Cvp Analysis

Strategy and the Master Budget

Decision Making With a Strategic Emphasis

Strategy and the Analysis of Capital Investments

Operational Performance Measurement: Sales, Direct-Cost Variances, and the Role of Nonfinancial Performance Measures

Operational Performance Measurement: Indirect-Cost Variances and Resource-Capacity Management

Operational Performance Measurement: Further Analysis of Productivity and Sales

The Management and Control of Quality

Strategic Performance Measurement: Cost Centers, Profit Centers, and the Balanced Scorecard

Strategic Performance Measurement: Investment Centers and Transfer Pricing

Management Compensation, Business Analysis, and Business Valuation

Filters