Exam 15: The Changing Business Environment - a Managers Perspective

The Assembly Department of KEIA employs three direct laborers and two supervisory personnel.For the past several months,the employees have been assembling desks from pieces prepared in the Cutting Department.Three desks are expected to be produced for every labor hour incurred in the department.The hours worked in April,May,and June appear below. Actual production of desks for April was 2,501; May,2,532; and June,2,601. a. Calculate the number of desks expected to be produced each month. b. By what percentage did production fall short of expectations each month? c. Comment on your calculations, and recommend what actions should be taken by the plant manager.

A business plan is a comprehensive statement of how a company will achieve its objectives,but does not include budgets or performance goals.

Which of the following is not a result of adopting a just-in-time operating environment?

Internal accounting reports should be prepared when they are needed,without regard to calendar dates or regularity of issue.

TQM can be used in

JIT,TQM,ABM,and TOC all make a contribution to

When there is an ethical conflict,the management accountant should resign if the immediate supervisor is involved with the conflict.

Mi Casa is a housekeeping company in Brownsville,Texas.The corporation is owned 100 percent by Jean Kline.Jean plans to develop the company into a multimillion-dollar company as the demand for housekeeping services in Brownsville is increasing at a rapid pace as the community grows. Currently,Jean has three housekeepers who each work a 40-hour week.Over the past four weeks,the actual hours worked were as follows: Weak 1 Weak 2 Weak 3 Weak 4 Total House keepers 136 140 145 145 566 Jean is concerned with the hours worked.Analyze the activity for the four weeks by preparing a table showing the estimated hours,actual hours,and the hours under (or over)estimate.Based on the information in your table,does Jean have reason for concern? If so,what could some of the possible reasons be for the hours spent?

Financial accounting usually involves analyses of various segments of a business,such as cost centers,profit centers,or departments,or of some specific aspect of its operations.

Chris Tyler owns and operates Surf's Up,a shop in Florida that sells surfboards and beachwear.The shop has been very successful,and now Chris is thinking of manufacturing his own brand of surfboards.Chris discussed the following with you: 1.He plans to add value by making boards that are easier to maneuver and faster in the water. 2.Chris wants to purchase high-quality materials. 3.He wants a logo that will be distinctive and recognizable. 4.He would like to implement efficient manufacturing processes that will enable him to quickly produce the boards when an order is placed. 5.He feels advertising is important. 6.Chris believes in customer satisfaction and wants to have courteous and efficient service for his customers.He also would like to develop a website to establish Internet customers. 7.Because Chris believes in customer service,he would like to provide a warranty service offering a free replacement if the customer is not satisfied. 8.Chris will need to hire and train employees to make the boards. 9.He will need legal advice when applying for a trademark and signing contracts. 10.He wants a computerized accounting system that also provides customer information and the ability to develop management reports. a.Identify from the value chain the primary processes that add value to the surfboards. b.Identify the support services that are part of the same value chain.

The overall guideline or limit for management accounting information is that the report or analysis must be meaningful and must answer the questions or issues under review.

Management accounting complements each stage in the management process.

Accountants have ranked among the highest in ethics among business professions and other occupations.List and briefly describe five ethical standards that management accountants subscribe to that,in your opinion,help maintain the impression that accountants are highly ethical. 1.maintain an appropriate level of professional competence by participating in the ongoing development of their knowledge and skills. 2.perform their professional duties in accordance with relevant laws,regulations,and technical standards. 3.prepare complete and clear reports and recommendations after appropriate analysis of relevant and reliable information.

In a JIT system,workers are trained to specialize in one specific task.

Comparing actual performance with expected performance levels is an evaluation activity.

In making the transition from financial accounting to management accounting,you must become accustomed to using the historical dollar as the primary unit of measurement.

Which of the following is a characteristic of management accounting?

Activity-based management focuses on enhancing activities that add value to the product and reducing those that do not.

Performance measures are limited to financial data.

Sinopole's Pharmaceutical Delivery Company is a high-volume business that features home delivery services to elderly shut-ins.Located in Bakersfield,California,the company currently uses six delivery trucks to service the area within a 100-mile radius of the city.Each delivery truck can make a maximum of 600 deliveries per month.In June,the demand for these deliveries totaled 3,200,and the company has been experiencing a 2 percent increase in demand,compounded monthly.In which month must the company add a seventh delivery truck,given these estimates?