Question 1

Select the statement that best completes the following sentence for all possible scenarios: 'Considering the entire value chain is important for management accounting in today's competitive environment because ....'

Accepted Answer

By considering the entire value chain, management may identify cost reduction opportunities that are not apparent when they focus on one aspect only. The value chain extends beyond production to suppliers and customers, and traditional systems have historically focused on the engineered costs of production rather than the discretionary costs of other aspects of the value chain.

Question 2

The production lead time may be defined as:

Accepted Answer

The answer of The production lead time may be defined...

Question 3

The following dates apply to a specific order processed by Hamilton Ltd: 
What is the production lead time?

Accepted Answer

The answer of The following dates apply to a specific...

Question 4

GoGo Furniture needs to purchase glass panes to make glass top coffee tables. Last year GoGo Furniture had two suppliers, BolBol and TolTol. Based on last year's experience with these two suppliers, GoGo provides you with the following supplier related information: 
What is the total amount of order-level costs relating to BolBol?

Accepted Answer

The answer of GoGo Furniture needs to purchase glass panes...

Question 5

Select the best answer. Backflush costing is appropriate when:

Accepted Answer

Backflush costing is a costing system used in just-in-time (JIT) environments where costs are not tracked in detail as the direct materials are not posted to the inventory account until they are actually used in production. This method is appropriate when both JIT production and JIT purchasing have been implemented. Therefore, option C is the correct choice. Options A, B, and D do not accurately describe when backflush costing is appropriate.

Question 6

GoGo Furniture needs to purchase glass panes to make glass top coffee tables. Last year GoGo Furniture has two suppliers, BolBol and TolTol. Based on last year's expernece with these two suppliers, GoGo provides you with the following supplier related information: 
The supplier performance index of BolBol and TolTol are, respectively:

Accepted Answer

Based on the supplier performance index, BolBol has a higher rating than TolTol, indicating that they performed better as a supplier. Therefore, the best choice for GoGo Furniture would be to purchase from BolBol.

Question 7

The following dates apply to a specific order processed by Hamilton Ltd: 
What is the waiting time?

Accepted Answer

The answer of The following dates apply to a specific...

Question 8

The following dates apply to a specific order processed by Hamilton Ltd: 
What is the production time?

Accepted Answer

The answer of The following dates apply to a specific...

Question 9

Nonsuch Ltd wishes to know the break-even point on its product, ADV, and provides the following data. 
What is the break-even point in years?

Accepted Answer

The answer of Nonsuch Ltd wishes to know the break-even...

Question 10

The following dates apply to a specific order processed by Hamilton Ltd: 
What is the customer response time?

Accepted Answer

The answer of The following dates apply to a specific...

Question 11

The analysis of the cost of products purchased and associated customer driven costs is known as:

Accepted Answer

Customer cost analysis is the analysis of the cost of products purchased and associated customer driven costs.

Question 12

The break-even time has which of the following characteristics?
i. It cannot be established until after the product development cycle is completed.
ii. It encourages incremental projects.
iii. It discourages major projects that take a long time.
iv. It measures cash flow not profit.

Accepted Answer

i. It cannot be established until after the product development cycle is completed.iii. It discourages major projects that take a long time.

Question 13

The following dates apply to a specific order processed by Hamilton Ltd: 
What is the order receipt time?

Accepted Answer

The answer of The following dates apply to a specific...

Question 14

Customer response time may be defined as:

Accepted Answer

Customer response time is the duration from when a customer places an order until they receive the completed order.

Question 15

Customer value is an important part of activity-based management and it enables an organisation to achieve both cost reduction and improved customer value through the use of which of the following?
i. Identifying major opportunities for cost reduction.
ii. Determining root causes of these costs.
iii. Developing programs to eliminate the causes of these costs.
iv. Introducing performance measures to monitor the effect of these programs.

Accepted Answer

Activity-based management focuses on identifying opportunities for cost reduction, determining the root causes of these costs, developing programs to eliminate these causes, and introducing performance measures to monitor the effects of these programs. This comprehensive approach helps in achieving cost reduction and improved customer value.

Question 16

Average cycle time is estimated by:

Accepted Answer

Average cycle time is calculated by dividing the total processing time by the number of good units produced, as it measures the time taken to produce a single good unit.

Question 17

The reason a just-in-time system focuses on the control of inventories is because:

Accepted Answer

Inventories are non-value-added characteristics because they do not add value to the product or service.

Question 18

Break-even time may be defined as:

Accepted Answer

Break-even time is defined as the period from the original concept or idea of a product until the point where enough profit has been generated to cover the initial investment costs. This includes all phases from concept, development, production, to sales, not just from the commencement of production or first delivery.

Question 19

GoGo Furniture needs to purchase glass panes to make glass top coffee tables. Last year GoGo Furniture has two suppliers, BolBol and TolTol. Based on last year's experience with these two suppliers, GoGo provides you with the following supplier related information: 
The total costs of ownership of BolBol and TolTol are, respectively:

Accepted Answer

The answer of GoGo Furniture needs to purchase glass panes...

Question 20

Time-based management is concerned with the elimination of idle time, which generates non-value-added costs in which of the following circumstances?

Accepted Answer

Time-based management aims to eliminate idle time and increase efficiency in all areas of the business, including production, sales, and customer service. Idle time can lead to excess inventory buildup, loss of customers due to delays or poor service, and delays in generating sales revenue. Therefore, all of the given answers are relevant circumstances in which idle time generates non-value-added costs.

Quiz 15: Managing Suppliers and Customers

Select the statement that best completes the following sentence for all possible scenarios: 'Considering the entire value chain is important for management accounting in today's competitive environment because ....'

The production lead time may be defined as:

The following dates apply to a specific order processed by Hamilton Ltd: What is the production lead time?

Select the best answer. Backflush costing is appropriate when:

The following dates apply to a specific order processed by Hamilton Ltd: What is the waiting time?

The following dates apply to a specific order processed by Hamilton Ltd: What is the production time?

Nonsuch Ltd wishes to know the break-even point on its product, ADV, and provides the following data. What is the break-even point in years?

The following dates apply to a specific order processed by Hamilton Ltd: What is the customer response time?

The analysis of the cost of products purchased and associated customer driven costs is known as:

The break-even time has which of the following characteristics? i. It cannot be established until after the product development cycle is completed. ii. It encourages incremental projects. iii. It discourages major projects that take a long time. iv. It measures cash flow not profit.

The following dates apply to a specific order processed by Hamilton Ltd: What is the order receipt time?

Customer response time may be defined as:

Average cycle time is estimated by:

The reason a just-in-time system focuses on the control of inventories is because:

Break-even time may be defined as:

Time-based management is concerned with the elimination of idle time, which generates non-value-added costs in which of the following circumstances?