1. Relevant costs for target costing include: (Points: 2)         variable manufacturing costs         variable manufacturing and variable nonmanufacturing costs         all fixed costs         all future costs, both variable and fixed

2. If a performance measure in the customer perspective of the Balanced Scorecard was customer loyalty, then a driver from the process perspective would MOST likely be: (Points: 2)         implementing cutting-edge technology         repeat sales         high-quality production processes         increased profits

3. Which of the following is NOT true regarding a control system? (Points: 2)         A control system includes developing organizational objectives and executing a plan for implementation.         A control system includes monitoring the current level of performance and comparing it to the planned level of performance.         The same performance measures apply to all organizations.         The basic control process applies to all organizations.

4. Which BEST describes the purpose of a management accounting and control system (MACS)? (Points: 2)         A MACS defines the value chain and identifies nonvalue-added activities for a business.         A MACS helps decision makers determine whether strategies and objectives are being met.         A MACS offers a system of controls to ensure employees are meeting predetermined standards.         A MACS provides a signal for management attention when areas are out-of-control.

5. The characteristic of a management accounting and control system that allows employees to customize applications for local decisions is referred to as being: (Points: 2)

        timely         flexible         accurate         in control

6. Total-life-cycle costing is particularly important when: (Points: 2)

        the development period for research, development, and engineering is short and inexpensive         there are significant nonproduction costs         most costs are locked in during production         a low percentage of costs are incurred before any revenues are received

7. ________ starts with estimated product costs and next determines the estimated selling price. (Points: 2)         Standard costing         Target costing         Kaizen costing         Traditional costing

8. ________ starts with estimated product costs and next adds the expected profit margin. (Points: 2)         Cost-plus pricing         Target costing         Kaizen costing         Standard costing

9. All of the following are true regarding target costing EXCEPT that: (Points: 2)         improvements are implemented in small, incremental amounts         customer input is collected continually throughout the target costing process         input is requested from suppliers and distributors         a key goal is to minimize costs over the product's useful life

10. All of the following are associated with target costing EXCEPT: (Points: 2)         value engineering         target reduction rates         supply-chain management         cross-functional teams

11. Use the information below to answer the following question(s). After conducting a market research study, Schultz Manufacturing decided to produce a new interior door to complement its exterior door line. It is estimated that the new interior door can be sold at a target price of $60. The annual target sales volume for interior doors is 20,000. Schultz has a 20% expected return on sales target. What is the target profit margin? (Points: 2)         $240,000         $300,000

        $192,000         $180,000 $1,200,000 x 20% = $240,000

12. Use the information below to answer the following question(s).

Dennis' TV currently sells small televisions for $180. It has costs of $140. A competitor is bringing a new small television to market that will sell for $150. Management believes it must lower the price to $150 to compete in the market for small televisions. Marketing believes that the new price will cause sales to increase by 10%, even with a new competitor in the market. Dennis' sales are currently 100,000 televisions per year. What is the new target cost if profit margin is 25% of sales? (Points: 2)         $37.50         $45.00         $112.50         $135.00

$150 - $150(0.25) = $112.50

13. The Balanced Scorecard is said to be "balanced" because it measures: (Points: 2)         short-term and long-term objectives         financial and nonfinancial objectives         internal and external objectives         All of these are correct.

14. ________ translate(s) an organization's mission, vision, and strategy into a comprehensive set of performance measures that provide the framework for implementing its strategy. (Points: 2)         Critical success factors         The value proposition         Objectives         The Balanced Scorecard

15. ________ establish the level of performance or rate of improvement required for a measure. (Points: 2)         Critical success factors         The value proposition         The Balanced Scorecard         Targets

16. Identify the BEST description of the Balanced Scorecard's internal perspective. To achieve our firm's vision and strategy: (Points: 2)         How do we lower costs?         How do we motivate employees?         How can we obtain greater profits?         What must we excel at to satisfy our customers and shareholders?

17. Measures of the Balanced Scorecard's customer perspective include: (Points: 2)         market share         number of on-time deliveries         number of process improvements         revenue growth

18. The following statements are true regarding the financial perspective EXCEPT: (Points: 2)         Financial performance can be improved through two basic approaches - revenue growth and productivity.         Financial objectives typically relate to profitability.         A financial measure might be net income.         A financial objective might be to offer low prices to satisfy and retain price-sensitive customers.

19. Nonprofit and government organizations: (Points: 2)         cannot use the Balanced Scorecard because they have no customers         cannot use the Balanced Scorecard because they have no financial objective         may use the Balanced Scorecard by adding a social impact perspective to the top of the strategy map         may use the Balanced Scorecard by not linking it to mission and strategy

20. To mobilize change, leadership should: (Points: 2)         actively involve the executive team         continually focus on the change initiatives         use teamwork to coordinate changes         All of these are correct.