Question 1

Which of the following typically would NOT be paid for using working capital?

Accepted Answer

A)  Purchase of new facilities 
B)  What it costs to store inventory 
C)  What a firm owes suppliers 
D)  Employee salaries 
E)  Marketing research costs

Question 2

Marketing cost analysis:

Accepted Answer

A)  just uses the same "natural" accounting categories commonly used for financial analysis. 
B)  allocates costs to products or customers to focus on the purpose for which marketing money is spent. 
C)  is not very accurate, since it is almost impossible to link marketing costs to specific sales. 
D)  is done more frequently than analysis of manufacturing costs. 
E)  None of these is true.

Question 3

A company with a successful marketing strategy has its own internal source of funds-profits.

Accepted Answer

A) True 
 B)False

Question 4

ConnectSys is a California-based manufacturer of computer networking equipment for home and small business users. When people call the company's toll-free customer support telephone number, they are connected to a customer service representative in India. ConnectSys uses this arrangement because the wages for customer service representatives are lower in India than in the United States. This is an example of:

Accepted Answer

A)  A virtual corporation. 
B)  Exporting telecommunications. 
C)  An indirect distribution channel. 
D)  A task transfer service. 
E)  None of these.

Question 5

Forecasting the amount of cash that will be available after paying expenses is straightforward because it's always equal to the firm's "bottom line"-the net profit figure shown on the operating statement.

Accepted Answer

A) True 
 B)False

Question 6

Many of the people affected by a new strategy may not be under the control of the marketing manager.

Accepted Answer

A) True 
 B)False

Question 7

It's not sensible for a firm to implement a marketing plan if the plan doesn't generate at least enough initial revenue to cover working capital needs.

Accepted Answer

A) True 
 B)False

Question 8

A financial report that forecasts how much money will be available after paying expenses is a(n):

Accepted Answer

A)  Income statement. 
B)  Balance sheet. 
C)  Cash flow statement. 
D)  Capital report. 
E)  None of these.

Question 9

At the Comfort Inn Web site, a customer can create an account with his preferences for a smoking or non-smoking room, the type of pillows he likes, early or late check-in and check-out, and his room location. The hotel keeps track of this information and uses it whenever this customer reserves a room in the future. This is an example of:

Accepted Answer

A)  Combined target market approach. 
B)  Diversification. 
C)  Task transfer. 
D)  Mass customization. 
E)  Single target market approach.

Question 10

A firm needs _____ to pay for short-term expenses such as employee salaries, advertising, marketing research, inventory storing costs, and what the firm owes suppliers.

Accepted Answer

A)  debt financing 
B)  current asset 
C)  prepaid expense 
D)  working capital 
E)  overhead

Question 11

A virtual corporation may enjoy flexibility in operations, but often at higher cost or with less control of quality and schedules.

Accepted Answer

A) True 
 B)False

Question 12

Capital requirements are likely to be less when intermediaries take on much of the responsibility for promotion in the channel.

Accepted Answer

A) True 
 B)False

Question 13

Coordinating the linkages between marketing and other functional areas is likely to be easier when a strategy involves developing a totally new product idea rather than just modifying an existing plan and established ways of doing things.

Accepted Answer

A) True 
 B)False

Question 14

Finding and allocating capital is usually the responsibility handled by a firm's chief financial officer.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following observations is true?

Accepted Answer

A)  In an organization, opportunities rarely compete for capital. 
B)  A dividend refers to the money invested in a firm. 
C)  The chief operations officer usually handles money matters in a firm. 
D)  Marketing plans that are funded usually must work within a budget constraint. 
E)  There's no reason for a firm's marketing manager and financial manager to work together since they are in different functional areas.

Question 16

As compared to natural accounts, FUNCTIONAL ACCOUNTS:

Accepted Answer

A)  are the accounts to which various costs are charged in the normal accounting cycle. 
B)  show the purpose for which expenditures are made. 
C)  include items such as storing, salaries, and taxes. 
D)  All of these. 
E)  Both are the accounts to which various costs are charged in the normal accounting cycle; and include items such as storing, salaries, and taxes.

Question 17

A firm's working capital may come from either internal sources-such as company bonds-or external sources-such as money paid by customers.

Accepted Answer

A) True 
 B)False

Question 18

A company has three products (X, Y, and Z) that it sells, packs, and ships to its customers. Because the products have different sizes they also have different packing and shipping costs so we will use a new measure-a packing/shipping unit. Because Product Y is the smallest of the three products, we will assign it a value of 1 packing/shipping unit. Product X is twice as big as Product Y and Product Z is four times as big as Product Y. On a monthly basis, this company sells an average of 1,500 units of Product X, 800 units of Product Y, and 60 units of Product Z. If the company spends on average of $3,720 each month on total packing/shipping costs, what amount should it allocate to Product X per month (to the nearest dollar amount)?

Accepted Answer

A)  $736 
B)  $1,380 
C)  $1,836 
D)  $2,500 
E)  $2,760

Question 19

A virtual corporation may not make anything at all.

Accepted Answer

A) True 
 B)False

Question 20

With externally generated funding a firm's marketing program may be expected to "pay its own way."

Accepted Answer

A) True 
 B)False

Exam 19: Managing Marketings Link With Other Functional Areas

Which of the following typically would NOT be paid for using working capital?

Marketing cost analysis:

A company with a successful marketing strategy has its own internal source of funds-profits.

Forecasting the amount of cash that will be available after paying expenses is straightforward because it's always equal to the firm's "bottom line"-the net profit figure shown on the operating statement.

Many of the people affected by a new strategy may not be under the control of the marketing manager.

It's not sensible for a firm to implement a marketing plan if the plan doesn't generate at least enough initial revenue to cover working capital needs.

A financial report that forecasts how much money will be available after paying expenses is a(n) :

A firm needs _____ to pay for short-term expenses such as employee salaries, advertising, marketing research, inventory storing costs, and what the firm owes suppliers.

A virtual corporation may enjoy flexibility in operations, but often at higher cost or with less control of quality and schedules.

Capital requirements are likely to be less when intermediaries take on much of the responsibility for promotion in the channel.

Coordinating the linkages between marketing and other functional areas is likely to be easier when a strategy involves developing a totally new product idea rather than just modifying an existing plan and established ways of doing things.

Finding and allocating capital is usually the responsibility handled by a firm's chief financial officer.

Which of the following observations is true?

As compared to natural accounts, FUNCTIONAL ACCOUNTS:

A firm's working capital may come from either internal sources-such as company bonds-or external sources-such as money paid by customers.

A virtual corporation may not make anything at all.

With externally generated funding a firm's marketing program may be expected to "pay its own way."