Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN: 9781305970663
Author: Don R. Hansen, Maryanne M. Mowen
Publisher: Cengage Learning
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Textbook Question
Chapter 15, Problem 20E
Total productive efficiency is achieved when both technical
- a. More output is produced using more inputs.
- b. More output is produced with the same inputs.
- c. More inputs are used to produce the same output.
- d. The least costly technically efficient input combination is chosen.
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The production of a fixed amount of output should be allocated between two production activities so that the marginal cost is the
same in each activity because otherwise overall costs can be reduced by reallocating the good with
O higher TC to the production of the good with lower TC.
O lower MC to the production of the good with higher MC.
lower TC to the production of the good with higher TC.
higher MC to the production of the good with lower MC.
True or FalseProcess value analysis is the examination, quantification, and explanation of the effects of cost drivers. The results are often used for continuous improvements programs to reduce throughput times, improve quality, and reduce costs
All of the following can be used to achieve low costs EXCEPT:
Availability of low-cost resources
Economies of scale
Economies of experience
Cost innovation
All of the above can be used to achieve low costs.
Chapter 15 Solutions
Cornerstones of Cost Management (Cornerstones Series)
Ch. 15 - Prob. 1DQCh. 15 - What are the five principles of lean thinking?Ch. 15 - Prob. 3DQCh. 15 - Prob. 4DQCh. 15 - Explain how lean manufacturing is able to produce...Ch. 15 - What role does a demand-pull system have on lean...Ch. 15 - Prob. 7DQCh. 15 - Prob. 8DQCh. 15 - What is the purpose of assigning facility costs to...Ch. 15 - Why are units shipped used to calculate the...
Ch. 15 - When will the average unit cost be useful for...Ch. 15 - Explain why changes in value-stream profitability...Ch. 15 - Prob. 13DQCh. 15 - Prob. 14DQCh. 15 - What is productivity measurement?Ch. 15 - Prob. 16DQCh. 15 - Prob. 17DQCh. 15 - Discuss the advantages and disadvantages of...Ch. 15 - Prob. 19DQCh. 15 - Prob. 20DQCh. 15 - What is profit-linked productivity measurement and...Ch. 15 - Prob. 22DQCh. 15 - What is the price-recovery component?Ch. 15 - Anderson Company has the following departmental...Ch. 15 - During the week of June 12, Harrison Manufacturing...Ch. 15 - In 20x2, Choctaw Company implements a new process...Ch. 15 - Refer to Cornerstone Exercise 15.3. Choctaw...Ch. 15 - Prob. 5ECh. 15 - Bienestar Inc., has the following departmental...Ch. 15 - Bienestar, Inc., implemented cellular...Ch. 15 - Henderson, Inc., has just created five order...Ch. 15 - Prob. 9ECh. 15 - Shorts Manufacturing, Inc., has implemented lean...Ch. 15 - The following Box Scorecard was prepared for a...Ch. 15 - Prob. 12ECh. 15 - Carsen Company produces handcrafted pottery that...Ch. 15 - Helena Company needs to increase its profits and...Ch. 15 - Helena Company needs to increase its profits and...Ch. 15 - Prob. 16ECh. 15 - Lean manufacturing is characterized by all but one...Ch. 15 - Lean manufacturing uses value streams to produce a...Ch. 15 - A manufacturing cell within a value stream is...Ch. 15 - Total productive efficiency is achieved when both...Ch. 15 - The following information is given for a...Ch. 15 - Sixty employees (all CPAs) of a local public...Ch. 15 - Sixty employees (all CPAs) of a local public...Ch. 15 - Bradford Company, a manufacturer of small tools,...Ch. 15 - Continuous improvement is the governing principle...Ch. 15 - Prob. 26PCh. 15 - Jadlow Company produces handcrafted leather...Ch. 15 - Prob. 28P
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- When operating in a constrained environment, which products should be produced? A. products with the highest contribution margin per unit B. products with the highest contribution margin per unit of the constrained process C. products with the highest selling price D. products with the lowest allocated joint costarrow_forwardStriving to produce the same activity output with lower costs for the input used is concerned with which of the following dimensions of activity performance? a. Quality b. Time c. Activity sharing d. Effectiveness e. Efficiencyarrow_forwardWhich of the following is true about the value of Problem Management? Improved productivity Reduced downtime Decreased costs All of the abovearrow_forward
- Reduced time-to-market, reduced expected service cost, and ease-of-manufacture are critical success factors at which stage of the cost life cycle? Multiple Choice Product planning and scheduling. Product design. Manufacturing. R & D.arrow_forwardThe concept of operating leverage involves the use of __________ to magnify returns at high levels of operation. Multiple Choice fixed costs variable costs marginal costs semi-variable costsarrow_forward“Increasing the number of indirect-cost pools is guaranteed to sizably increase the accuracy of product or service costs.” Do you agree? Why?arrow_forward
- Dogarrow_forwardWhat is the scattergraph method, and why is it used? Why is a scattergraph a good first step in separating mixed costs into their fixed and variable components?arrow_forwardContinuous improvement is the governing principle of a lean accounting system. Following are several performance measures. Some of these measures would be associated with a traditional standard-costing accounting system, and some would be associated with a lean accounting system. a. Materials price variances b. Cycle time c. Comparison of actual product costs with target costs d. Materials quantity or efficiency variances e. Comparison of actual product costs over time (trend reports) f. Comparison of actual overhead costs, item by item, with the corresponding budgeted costs g. Comparison of product costs with competitors product costs h. Percentage of on-time deliveries i. First-time through j. Reports of value- and non-value-added costs k. Labor efficiency variances l. Days of inventory m. Downtime n. Manufacturing cycle efficiency (MCE) o. Unused (available) capacity variance p. Labor rate variance q. Using a sister plants best practices as a performance standard Required: 1. Classify each measure as lean or traditional (standard costing). If traditional, discuss the measures limitations for a lean environment. If it is a lean measure, describe how the measure supports the objectives of lean manufacturing. 2. Classify the measures into operational (nonfinancial) and financial categories. Explain why operational measures are better for control at the shop level (production floor) than financial measures. Should any financial measures be used at the operational level? 3. Suggest some additional measures that you would like to see added to the list that would be supportive of lean objectives.arrow_forward
- Which of the following objectives would likely be associated with the customer perspective of the balanced scorecard? a. Increasing post-sales service efficiency b. Decreasing product development cycle time c. Reducing distribution channel cost d. Increasing delivery reliabilityarrow_forwardCVP analysis using activity-based costs will tend to shift some costs from fixed to variable classifications, resulting in: Multiple Choice A higher contribution margin per unit. Lower breakeven sales. Higher breakeven sales. Higher or lower breakeven sales, depending on batch size. A lower contribution margin per unit.arrow_forwardMatch each definition (See picture) with related terms below: -Capacity -Common Fixed Costs -Complementary Products -Constrained Resources -Direct Fixed Cost -Idle Capacity -Incremental Analysis -Segment Margin -Substitute Products -None of these are correctarrow_forward
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