Exam 1: Cost Management and Strategy

Which of the following is a contemporary management technique used by the management accountant to identify and monitor the costs of a product throughout all steps from product design to the finished product?

The manager of a business unit of a large corporation made some projections regarding sales and profits for the upcoming final quarter of the year. The managers' performance evaluation and compensation depended significantly on his ability to meet budget goals. The manager discovered that the final quarter would have to be a particularly good quarter in order to meet these goals. He decided to implement a sales program offering liberal payment terms in order to pull some sales that would normally occur next year into the current year. Customers accepting delivery in the fourth quarter would not have to pay the invoice for 140 days. Also, he sold some equipment that was not being used and realized a significant profit on the sale. Required: Are these actions ethical? Why or why not?

A firm that has traditionally succeeded on the basis of its innovative products and excellent customer service has started to place greater emphasis on reducing waste and providing its customers with the lowest priced product. Which of the following most accurately describes this change of competitive strategy?

Which of the following does not represent a main focus of cost management information?

One of the many changes in the business environment in recent years that has had significant impact on cost management practices is a "focus on the customer". You are part of the management team in a medium-size Internet service company. The company is just three years old and is growing dramatically, doubling its customer base every six months. Required: (a) Describe your typical customer's needs and service expectations. (b) How has the doubling of your firm's customer base every six months affected its ability to maintain this focus on the customer? If this dramatic growth continues, what are some specific actions your firm can take to retain its goal of "focus on the customer"?

A potential weakness of the cost leadership strategy is:

In the late 1990s, management at General Motors decided to improve the competitiveness of its products by stressing product quality, style, and innovation. The objective was to improve the image of GM vehicles and thus improve sales and brand loyalty. Managers decided to push this strategy in both the manufacturing and marketing divisions of the firm. One of the key moves to implement this strategy was to insist that GM dealers stop price-cutting and push brand value and image instead. GM exerted some control over dealers' pricing/selling strategy in part by reducing the money it set aside for dealers to use in local ads. Required: Was General Motors following a strategy of cost leadership or differentiation at this time? Comment on how effective you think the new strategy in dealer relations is likely to be.

The five steps of strategic decision making include all of the following except:

All of the following are examples of total quality management practices except:

Which of the following organizations supports the growth and professionalism of management accounting practice?

Required: Identify two of the most successful companies or organizations in today's business environment, in your opinion. Explain why they are so successful.

The competitive strategy in which the firm succeeds by developing and maintaining a unique value for the product, as perceived by the customer, is termed:

According to the IMA Statement of Ethical Professional Practice, what should a management accountant do if a significant ethical situation can't be resolved?

Which of the following is not one of the ethical standards included in the Institute of Management Accountants (IMA) Statement of Ethical Professional Practice?

Which of the following most accurately describes what is included in cost management information?

When managers produce value for the customer, their orientation consists of all the following except:

Target costing:

Which of following statements is/are true concerning strategic positioning?

Which of the following is not a way for a management accountant to resolve an ethical conflict?

RTP Corp. is developing a new computer processor to compete against Intel's successful product line. RTP has already determined the market price and the required profit margin on each processor sold in order to be successful. Which costing method will RTP most likely use to reduce costs and obtain the desired results?