ACG 3361 CH. 1-6
Terms in this set (107)
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
The difference between wholesalers and retailers is:
State of the art manufacturing facilities
When managers produce value for the customer, their orientation consists of all the following except:
Life cycle costing
Which of the following is not a contemporary management technique used by the management accountant to focus on process improvement?
Cost management information typically is the responsibility of the:
Non-financial information, including customer satisfaction, innovation, etc.
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
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
The five steps of strategic decision making include all of the following except:
The development of improved cost management methods
Which of the following is not a major change in the business environment that has affected the way many companies think about conducting business?
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
The competitive strategy of cost leadership allows a firm to outperform competitors by producing products or services:
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
A potential weakness of the cost leadership strategy is:
Enterprise risk management
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
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
The Dodd-Frank Act (2010) includes a variety of new regulations, including the creation of:
Which of the following contemporary management techniques requires a balancing of multiple goals?
A set of plans for using resources to achieve sustainable goals
In the current business environment, companies cannot survive without a long-term strategy. What exactly should an effective strategy include?
Differentiation to cost leadership
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?
A firm following both competitive strategies is likely to succeed only if it achieves one of them significantly
which of the following statements is/are true concerning strategic positioning?
Life cycle costing
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 management accountant who planned to improve an organization's operations by developing models of consumer behavior would be using which of the following contemporary management techniques:
In 1494 the book Summa de arithmetica, geometria, proportioni et proportionalita (The Collected Knowledge of Arithmetic, Geometry, Proportion and Proportionality) was published in Italy. Its author was the forty-nine-year-old Luca Pacioli (c. 1445-1517) from Sansepulcro, in Tuscany - a Franciscan friar, mathematician, university teacher and "Magister" (or master).
Critical success factors in the balance scorecard
In the chapter Particularis de Computis et Scripturis in more details. The following is a list of accounting terms, rules and principles that Luca Pacioli described in his book - which one of the following is incorrect:
(CHAPTER 2 STARTS HERE)
Looking outside the firm
In SWOT analysis, opportunities and threats are identified by:
A patent developed by another firm for manufacturing a product
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
The main objective of value chain analysis is to identify stages of the value chain where the firm can:
growth in industry productivity
With regard to critical success factors, which one of the following would not be considered a financial measure of success?
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
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
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
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
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
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
During the strengths and weaknesses portion of a firm's SWOT analysis, which of the following would not be discovered?
The strategy map
The cause and effect relationships among critical success factors are best captured in:
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)
When performing value chain analysis, which of the following should a firm take into account?
Economic, Social, and environmental
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
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?
Earnings from operations
The financial critical success factor of profitability can be measured by:
Categories for environmental performance indicators
The world resources institute has defined:
Which of the following perspectives of a Balanced Scorecard would most likely be the ultimate target in a strategy map for a public company?
laws and organizations which regulate international trade
NAFTA and WTO refer to
Unique skills compared to industry standards
all of the following are required resources for cost leadership except:
Which of the following is not a reason why global companies choose to report on corporate responsibility?
Carbon emissions, pollutants production, fossil fuel use
(ALL of the above)
Which of the following are/is an environmental performance indicator?
The United Nations
The Global Reporting Initiative is an independent group that partners with other groups to address the measurement of sustainability, including a partnership with:
Strong coordination among functions: research, product development, manufacturing, and marketing
Effective execution of the cost leadership strategy requires all of the following except:
(CHAPTER 3 BEGINS)
its value is equal to or greater than its cost
Theoretically, a decision maker would probably be willing to buy cost management information if:
The change in total cost associated with each change in the quantity of the cost driver is:
Which one of the following would not be found in a merchandising company?
Insurance on a factory building
Which of the following is normally considered to be a product cost?
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:
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 $3,590 What are the direct labor costs for the period?
Technology, experience, complexity, scale
(ALL of the above)
Which of the following should be considered a structural cost driver
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
The main objective(s) of internal accounting controls is/are:
cost added; cost transferred out
Complete the inventory formula: Beginning Inventory + ______ = ________ + Ending Inventory
Depreciation on company-owned sales outlets
Which of the following is not an example of a product cost?
Planned costs the firm should attain
Standard costs are:
Cost object, product or service variety, and timing of unit cost calculation
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
Departmental rates are appropriate when all the following exist except:
Job costing for direct materials costs and process costing for conversion cost
Operation costing is a hybrid costing system for products and services that uses:
Cost system design/selection should consider all but which one of the following?
Which one of the following is the amount of factory overhead applied that exceeds the actual factory overhead cost?
Which one of the following is the amount that actual factory overhead exceeds the factory overhead applied?
Cost of good manufactured
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:
Some actual factory overhead costs are incurred unexpectedly
Production volume may vary from expected volume
Some actual factory overhead cost varies from the expected
(ALL of the above)
Factory overhead can be over-or under-applied because:
Finished Goods Inventory account is debited
When completed units are transferred to the warehouse:
cost of completed goods being transferred out of the plant
All of the following items are debited to the Work-in-Process Inventory account except:
a single product, a batch of products, or a single well-defined project
In job costing, the job might consist of:
the pull method of production
A job in which a quantity of products is ordered by a single customer is more likely to be an example of:
There are a variety of software systems, often designed specifically for a particular industry
An good example of a software system(s) that can be used to prepare job cost reports is:
Specific job: Yes
Common to all jobs: Yes
Scrap can be classified according to which of the following?
The primary focus of job costing in service industries is on:
Shows the time an employee worked on each job, the pay rate, and the total cost chargeable to each job
A time ticket:
Many firms use which one of the following terms to indicate the use of job costing in service industries?
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
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
Effective implementation of activity-based costing (ABC) requires:
Resource consumption cost driver
A measure of the quantity of resources consumed by an activity is:
An activity that is performed for each unit of production is a(n):
number of materials handling transactions
Which of the following is a batch-level cost driver?
Facilitate better product pricing decisions
Which of the following is a benefit of activity-based costing?
Identify more costs as indirect costs than do traditional volume-based systems
All of the following statements regarding activity-based costing systems are true except they:
placing purchase orders
Which of the following would not be considered a facility-level activity?
Procurement costs such as costs of placing orders for materials and paying suppliers are usually classified as:
customer batch-level cost
Invoicing cost is an example of a:
customer cost analysis
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
In the context of ABC, cross-subsidization refers to:
Helps identify actions that affect customer profitability
Customer profitability analysis:
(CHAPTER 6 BEGINS HERE)
direct labor and factory overhead costs
In calculating unit cost in a process costing system, "conversion cost" is defined as the sum of:
Assigning cost to completed and uncompleted production
The fifth and final step in determining process costs is:
the current period
The weighted-average method of process costing makes no distinction between the cost incurred prior to the current period and the cost incurred in:
Which one of the following process costing methods combines both current and prior costs in determining cost per equivalent unit?
units to account for
The sum of the beginning inventory units and the number of units started during the period determines the:
In work-in-process at the beginning of the period times the percent of work necessary to complete the items, plus the number of units started and completed during the period, plus the number of units remaining in work-in-process at the end of the period times the percent of work done during the period
When using the first-in, first-out method of process costing, equivalent units for work done during this period is equal to the number of units:
Which of the following characteristics applies to process costing but not to job costing?
The journal entry to record incurred direct labor would include a credit to:
Direct labor and manufacturing overhead
Conversion costs in a process cost system include:
Place the following Process costing steps in the correct order: 1 - Calculate equivalent units 2 - Determine the total costs to account for 3 - Analyze flow of physical units 4 - Assign total manufacturing costs 5 - Compute unit costs
Abnormal spoilage is considered what kind of cost?
The costs assigned to both units completed and ending work-in-process inventories
The equivalent units of a department
The physical units of a department
the costs incurred during the period
(ALL OF THE ABOVE)
A Production Cost Report summarizes all except:
Kimberly-Clark (paper products)
Reichhold Chemical (chemicals)
Royal Dutch Shell Group
(ALL OF THE ABOVE)
Process costing can be found in which of the following companies (industries)?
Charges current production costs directly to finished goods inventory
Backflush costing is a costing method that:
Activity Based Costing
Reichhold Chemical Company uses process costing together with:
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