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Cost Accounting: A Managerial Emphasis, 16e (Horngren) Chapter 12 Strategy, Balanced Scorecard, and Strategic Profitability Analysis Q&A$15.49
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Cost Accounting: A Managerial Emphasis, 16e (Horngren) Chapter 12 Strategy, Balanced Scorecard, and Strategic Profitability Analysis Q&A
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Course
ACCT 3201
Institution
University Of Minnesota, Duluth
1) Which of the following statements best define strategy?
A) It describes how an organization can create value for its customers while differentiating
itself from
its competitors.
B) It is an organization's ability to achieve lower costs relative to competitors through
productivity and effici...
and strategic profitability analysis 121 objective 121 1 which of the following statements best defin
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University Of Minnesota, Duluth
ACCT 3201
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Cost Accounting: A Managerial Emphasis, 16e (Horngren)
Chapter 12 Strategy, Balanced Scorecard, and Strategic
Profitability Analysis
12.1 Objective 12.1
1) Which of the following statements best define strategy?
A) It describes how an organization can create value for its customers while differentiating
itself from
its competitors.
B) It is an organization's ability to achieve lower costs relative to competitors through
productivity and efficiency improvements, elimination of waste, and tight cost control.
C) It is an organization's ability to offer products or services its customers perceive to be
superior and unique relative to the products or services of its competitors.
D) It describes how an organization motivates its employees to work for more hours
without any increase in their wages.
Answer: A
Diff: 2
Objective: 1
AACSB: Analytical thinking
2) In general, profit potential of an organization decreases with ________.
A) lesser competition and stronger potential entrants
B) greater competition and stronger potential entrants
C) lesser competition and weaker potential entrants
D) greater competition and weaker potential entrants
Answer: B
Diff: 2
Objective: 1
AACSB: Analytical thinking
3) Which of the following statements best define a product differentiation strategy?
A) It describes how an organization can increase customer base by differentiating its'
product prices from its competitors.
B) It is an organization's ability to achieve lower costs relative to competitors through
productivity and efficiency improvements, elimination of waste, and tight cost control.
C) It describes how an organization can decrease product prices by differentiating its' raw
materials from its competitors.
D) It is an organization's ability to offer products or services its customers perceive to be
superior and unique relative to the products or services of its competitors.
Answer: D
Diff: 2
Objective: 1
AACSB: Analytical thinking
,4) Which of the following focuses on these five factors: competitors, potential entrants to
the market, equivalent products, bargaining power of customers, and bargaining power of
suppliers?
A) balanced scorecard
B) product differentiation analysis
C) industry analysis
D) business process reengineering
Answer: C
Diff: 2
Objective: 1
AACSB: Analytical thinking
5) What is the term that describes an organization's ability to offer products or services
that are perceived by its customers as being superior and unique relative to those of its
competitors?
A) Strategy
B) Product differentiation
C) Cost leadership
D) The balanced scorecard
Answer: B
Diff: 1
Objective: 1
AACSB: Analytical thinking
6) What is the term for an organization's ability to achieve lower costs relative to
competitors through productivity and efficiency improvements, elimination of waste, and
tight cost control?
A) Marketing strategy
B) Product differentiation
C) Cost leadership
D) Competitor differentiation
Answer: C
Diff: 1
Objective: 1
AACSB: Analytical thinking
7) An organization that is using the product differentiation approach would most likely do
which of the following?
A) focus on tight cost control to create a reputation of saving its customers money
B) use innovative research and development and develop effective promotional campaigns
to increase customer loyalty and charge higher prices
C) provide products that are similar to competitors
D) offer products at a lower cost than competitors
Answer: B
Diff: 2
Objective: 1
AACSB: Analytical thinking
,8) An organization that is using the cost leadership approach would ________.
A) incur costs for innovative R&D
B) provide products at a higher cost than competitors
C) focus on productivity through efficiency improvements
D) bring products to market rapidly
Answer: C
Diff: 2
Objective: 1
AACSB: Analytical thinking
9) Stewart Corporation plans to grow by offering a sound system, the SS3000, that is
superior and unique from the competition. Stewart believes that putting additional
resources into R&D and staying ahead of the competition with technological innovations is
critical to implementing its strategy. Which of the following terms best describes Stewart's
strategy?
A) product differentiation
B) scalability
C) product leadership
D) cost leadership
Answer: A
Diff: 2
Objective: 1
AACSB: Application of knowledge
10) Magic Corporation manufactures water toys. It plans to grow by producing high-quality
water toys that are delivered in a timely manner. There are a number of other
manufacturers who produce similar water toys. Magic believes that continuously improving
its manufacturing processes and re-engineering processes to downsize and eliminate
excess capacity are critical to implementing its strategy. Which of the following best
describes Magic's strategy?
A) product differentiation
B) product leadership
C) cost differentiation
D) cost leadership
Answer: D
Diff: 2
Objective: 1
AACSB: Application of knowledge
11) Strategy describes how an organization matches its own capabilities with the
opportunities in the marketplace to accomplish its overall objectives.
Answer: TRUE
Diff: 1
Objective: 1
AACSB: Analytical thinking
12) One of the five forces of industry analysis is understand the bargaining power of
customers.
Answer: TRUE
Diff: 1
Objective: 1
AACSB: Analytical thinking
13) Higher selling prices, rather than unique products or services, provide a competitive
advantage for the cost leader companies.
Answer: FALSE
Explanation: Lower selling prices, rather than unique products or services, provide a
competitive advantage for the cost leader companies.
Diff: 1
Objective: 1
, AACSB: Analytical thinking
14) An organization which uses product differentiation strategy will charge higher prices.
Answer: TRUE
Diff: 1
Objective: 1
AACSB: Analytical thinking
15) The cost leadership strategy is for products and services that are similar to a
competitors products and services.
Answer: TRUE
Diff: 1
Objective: 1
AACSB: Analytical thinking
16) The cost leadership strategy is best for a company if the engineering staff is more
skilled at creatively designing new products than at making process improvements.
Answer: FALSE
Explanation: The cost leadership strategy is best for a company if the engineering staff is
more skilled at making process improvements than at creatively designing new products.
Diff: 2
Objective: 1
AACSB: Analytical thinking
17) Cost-leadership strategy usually focuses productivity and efficiency improvements ,
elimination of waste along with effective cost control systems.
Answer: TRUE
Diff: 2
Objective: 1
AACSB: Analytical thinking
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