15) Which of the following is an area that customers want to see improved levels of performance?
A) higher sales margin B) quality of the product C) lower marginal costs D) profit margins Answer: B
Diff: 2 Objective: 3
AACSB: Analytical thinking
16) Which of the following statements about a company's supply chain is true? A) A company's supply chain is always internal to a firm. B) A company's supply chain is always external to a firm.
C) A company's supply chain is the same thing as a company's value chain.
D) Management accountants provide information to enhance a company's supply chain. Answer: D
Diff: 2 Objective: 3
AACSB: Analytical thinking
17) Management accounting information helps managers calculate a target cost for a product ________.
A) by subtracting from the target price the operating income per unit of product that the company wants to earn
B) by subtracting from the target price the net income per unit of product that the company wants to earn
C) by subtracting profit margin per unit from the target price of product that the company wants to earn
D) by adding the operating income per unit and the contribution margin per unit Answer: A
Diff: 2 Objective: 3
AACSB: Analytical thinking
18) The ________ function supports the six functions of value-chain analysis. A) administration B) controlling C) planning D) direction Answer: B
Diff: 1 Objective: 3
AACSB: Analytical thinking
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19) ________ aims to improve operations throughout the value chain and to deliver products and services that exceed customer expectations. A) Total Quality Management B) Innovation
C) Customer response time D) Cost and efficiency Answer: A
Diff: 1 Objective: 3
AACSB: Analytical thinking
20) New-product development time is the time taken by companies to ________. A) test the prototype and start the large scale production of a product B) design and develop the prototype product C) create new products and bring them to market
D) improvise existing products and re-launch them to market Answer: C
Diff: 2 Objective: 3
AACSB: Analytical thinking
21) Customer response time involves ________.
A) the speed it takes a customer to respond to an advertisement and place an order B) the speed at which an organization responds to customer requests C) the speed it takes to develop a new product
D) the speed it takes an organization to develop a Total Quality Management (TQM) program Answer: B
Diff: 2 Objective: 3
AACSB: Analytical thinking
22) Which of the following is true of sustainability?
A) It helps in implementing strategies to improvise the product. B) It concerns with purchase of material in larger quantities.
C) It helps the development and implementation of strategies to achieve long-term financial, social, and environmental goals.
D) It helps manufacturing firms produce products more efficiently ensuring lower costs at an optimum use of available resources. Answer: C
Diff: 2 Objective: 3
AACSB: Analytical thinking
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23) The supply chain refers to the sequence of business functions in which customer usefulness is added to products or services. Answer: FALSE
Explanation: The value chain refers to the sequence of business functions in which customer usefulness is added to products or services.
Diff: 2 Objective: 3
AACSB: Analytical thinking
24) An effective way to cut costs is to eliminate activities that do NOT improve the product attributes that customers value. Answer: TRUE
Diff: 1 Objective: 3
AACSB: Analytical thinking
25) For optimal planning success it is best if each business function within the value chain is performed one at a time in sequence. Answer: FALSE
Explanation: Optimally, success is achieved when two or more of the individual business functions work concurrently as a team.
Diff: 2 Objective: 3
AACSB: Analytical thinking
26) For best results, cost management emphasizes independently coordinating supply chain activities within your company and with other companies that act as suppliers and customers. Answer: TRUE
Diff: 2 Objective: 3
AACSB: Analytical thinking
27) Technological innovation has led to shorter product-life cycles and increased the need to bring new products to market more rapidly. Answer: TRUE
Diff: 1 Objective: 2
AACSB: Analytical thinking
28) Management accounting information helps managers calculate a target cost for a product by subtracting from the target price the net income per unit of product that the company wants to earn. Answer: FALSE
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Explanation: Management accounting information helps managers calculate a target cost for a product by subtracting from the target price the operating income per unit of product that the company wants to earn.
Diff: 2 Objective: 2
AACSB: Analytical thinking
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