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ACG 3361 CH 1- 6 EXAM STUDY SET WITH COMPLETE SOLUTIONS
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competitive position - ANSWER Strategic management can be defined as the development of a sustainable:
Wholesalers are merchandisers that sell to other merchandisers whereas retailers are merchandisers that sell directly to consumers - ANSWER The difference between wholesalers and retailers is:
State of the art manufacturing facilities - ANSWER When managers produce value for the customer, their orientation consists of all the following except:
Life cycle costing - ANSWER Which of the following is not a contemporary management technique used by the management accountant to focus on process improvement?
Controller - ANSWER Cost management information typically is the responsibility of the:
Non-financial information, including customer satisfaction, innovation, etc. - ANSWER A local area consulting firm is trying to increase the long-term strategic focus of its company reports Therefore, the firm has decided to use the balanced scorecard What type of new information, that the company currently doesn't use in its financial reports, should the company include?
They have turned from a sole focus on manufacturing costs to a much wider outlook, taking into account costs from the entire product life-cycle - ANSWER In keeping with the current trend of increased strategic planning, how have management accountants changed their use of life-cycle costing?
Gather, summarize, and report accounting information - ANSWER The five steps of strategic decision making include all of the following except:
The development of improved cost management methods - ANSWER Which of the following is not a major change in the business environment that has affected the way many companies think about conducting business?
Integrative approach - ANSWER Corporate management is required to identify and solve problems from a cross-functional view Instead of viewing a problem as related to a specific business function, management solves these problems by combining skills from different functions simultaneously This approach is called:
At lower cost achieved by increased productivity
THINK WALMART.... - ANSWER The competitive strategy of cost leadership allows a firm to outperform competitors by producing products or services:
Cost leadership - ANSWER Many companies in the consumer products and electronics industries such as Walmart and Texas Instruments compete using a strategy of:
Deleting key features or reducing quality of products or services - ANSWER A potential weakness of the cost leadership strategy is:
Enterprise risk management - ANSWER Of the following, which aspect of a contemporary management technique is a framework and process that organizations use to manage the occurrence of possible events that could negatively or positively affect the company's competitiveness and success?
Better product design - ANSWER A large company has recently been experiencing larger than normal inventory levels. Management would like to implement a theory of constraints system to help control the company's inventories. Which of the following is not a benefit associated with the theory of constraints?
The consumer financial protection Bureau - ANSWER The Dodd-Frank Act (2010) includes a variety of new regulations, including the creation of:
is incorrect:
(CHAPTER 2 STARTS HERE)
Looking outside the firm - ANSWER In SWOT analysis, opportunities and threats are identified by:
A patent developed by another firm for manufacturing a product - ANSWER Which of the following does not represent a possible opportunity for a manufacturing firm as a part of SWOT analysis?
Increase value to the customer or reduce cost in some way - ANSWER The main objective of value chain analysis is to identify stages of the value chain where the firm can:
growth in industry productivity - ANSWER With regard to critical success factors, which one of the following would not be considered a financial measure of success?
Tax reporting - ANSWER Which one of the following is not usually included as a perspective of the balanced scorecard?
Information that addresses the strategic objectives of the organization - ANSWER Which of the following best describes the type of information that cost management must provide that is important for the success of the organization?
monitor progress toward achieving strategic goals - ANSWER After critical success factors (CSFs) have been identified, the next step in developing a competitive strategy is to develop relevant and reliable measure for these CFSs. These measures are important to help the organization:
It provides a comprehensive financial overview of the firm - ANSWER A firm has decided to use the balanced scorecard. Which of the following is not an advantage the company will gain by using the balanced scorecard?
During the second step, when the firm develops a competitive advantage by either reducing cost or adding value - ANSWER During which step of value chain analysis will the company discover whether or not it has a cost advantage, and why?
its research and development - ANSWER A local pharmaceutical firm has just announced its discovery of a revolutionary new drug for dieting However, due to its deteriorating relationship with its union, the unionized portions of the company's employees have threatened to strike In addition, the company's stock has started to drop due to the firm's difficulty in paying off some of its debt In this example, what was the firm's core competency(ies)?
Due to a lack of barriers to entry into the industry, several new competitors were beginning to enter the market - ANSWER During the strengths and weaknesses portion of a firm's SWOT analysis, which of the following would not be discovered?
The strategy map - ANSWER The cause and effect relationships among critical success factors are best captured in:
Materials handling - ANSWER Which of the following would likely not be considered part of the value chain in a service firm?
Opportunities to reduce cost, the firm's competitive position, possible opportunities where value can be added, and the decision to enter or leave an activity in the value chain
(ALL of the above) - ANSWER When performing value chain analysis, which of the following should a firm take into account?
Economic, Social, and environmental - ANSWER Sustainability is the balancing of short and long term goals in all three dimensions of the company's performance Those three areas are:
Develop and implement a sustainability scorecard - ANSWER Over the past several years it has become increasingly important for firms to improve achievement towards their social and environmental responsibilities. What is the best way the management accountant can help the firm improve on sustainability?
(CHAPTER 3 BEGINS)
its value is equal to or greater than its cost - ANSWER Theoretically, a decision maker would probably be willing to buy cost management information if:
Variable cost - ANSWER The change in total cost associated with each change in the quantity of the cost driver is:
Work-in-process - ANSWER Which one of the following would not be found in a merchandising company?
Insurance on a factory building - ANSWER Which of the following is normally considered to be a product cost?
Conversion Costs - ANSWER A manufacturer of machinery currently produces equipment for a single client. The client supplies all required raw material on a no-cost basis. The manufacturer contracts to complete the desired units from this raw material. The total production costs incurred by the manufacturer are correctly identified as:
$1,596 - ANSWER Factory overhead costs for a given period were 3.3 times as much as the direct material costs Prime costs totaled $2,200 Conversion costs totaled $3, What are the direct labor costs for the period?
Technology, experience, complexity, scale
(ALL of the above) - ANSWER Which of the following should be considered a structural cost driver
Direct Materials - ANSWER A manager of a small manufacturing firm is interested in knowing what the company's product costs are. Which of the following would be considered a product cost for the manager's company?
to prevent or detects errors and fraudulent acts - ANSWER The main objective(s) of internal accounting controls is/are:
cost added; cost transferred out - ANSWER Complete the inventory formula: Beginning Inventory + ______ = ________ + Ending Inventory
Depreciation on company-owned sales outlets - ANSWER Which of the following is not an example of a product cost?
Planned costs the firm should attain - ANSWER Standard costs are:
Cost object, product or service variety, and timing of unit cost calculation - ANSWER The three major differences between process and job order costing systems are those relating to:
All departments have similar cost drivers and cost usage characteristics - ANSWER Departmental rates are appropriate when all the following exist except:
Job costing for direct materials costs and process costing for conversion cost - ANSWER Operation costing is a hybrid costing system for products and services that uses:
Customer needs - ANSWER Cost system design/selection should consider all but which one of the following?
overapplied overhead - ANSWER Which one of the following is the amount of factory overhead applied that exceeds the actual factory overhead cost?
underapplied overhead - ANSWER Which one of the following is the amount that actual factory overhead exceeds the factory overhead applied?
Cost of good manufactured - ANSWER The total cost of direct materials, direct labor, and factory overhead transferred from the Work-in-Process Inventory account to the Finished Goods Inventory account during an accounting period is:
Project costing - ANSWER Many firms use which one of the following terms to indicate the use of job costing in service industries?
International Paper - ANSWER All of the following are examples of companies using job costing systems except:
(CHAPTER 5 STARTS HERE)
The resources, activities and cost drivers in the operation - ANSWER In performing activity analysis during the design of an activity-based costing system (ABC), the management accountant studies:
Support of top management and key employees - ANSWER Effective implementation of activity-based costing (ABC) requires:
Resource consumption cost driver - ANSWER A measure of the quantity of resources consumed by an activity is:
unit-level activity - ANSWER An activity that is performed for each unit of production is a(n):
number of materials handling transactions - ANSWER Which of the following is a batch-level cost driver?
Facilitate better product pricing decisions - ANSWER Which of the following is a benefit of activity-based costing?
Identify more costs as indirect costs than do traditional volume-based systems - ANSWER All of the following statements regarding activity-based costing systems are true except they:
placing purchase orders - ANSWER Which of the following would not be considered a facility-level activity?
batch-level costs - ANSWER Procurement costs such as costs of placing orders for materials and paying suppliers are usually classified as:
customer batch-level cost - ANSWER Invoicing cost is an example of a:
customer cost analysis - ANSWER Which of the following is a description of categorizing related customer costs into cost pools on the basis of cost drivers?
Costing inaccuracies which affect the relative profitability of products - ANSWER In the context of ABC, cross-subsidization refers to:
Helps identify actions that affect customer profitability - ANSWER Customer profitability analysis:
(CHAPTER 6 BEGINS HERE)
direct labor and factory overhead costs - ANSWER In calculating unit cost in a process costing system, "conversion cost" is defined as the sum of:
Assigning cost to completed and uncompleted production - ANSWER The fifth and final step in determining process costs is:
the current period - ANSWER The weighted-average method of process costing makes no distinction between the cost incurred prior to the current period and the cost incurred in:
weighted-average method - ANSWER Which one of the following process costing methods combines both current and prior costs in determining cost per equivalent unit?
Kimberly-Clark (paper products)
Reichhold Chemical (chemicals)
Coca-Cola
Royal Dutch Shell Group
(ALL OF THE ABOVE) - ANSWER Process costing can be found in which of the following companies (industries)?
Charges current production costs directly to finished goods inventory - ANSWER Backflush costing is a costing method that:
Activity Based Costing - ANSWER Reichhold Chemical Company uses process costing together with:
