Question :
SHORT ANSWER.
Write the word or phrase that best completes each : 1196081
SHORT ANSWER.
Write the word or phrase that best completes each statement or answers the question. 82)
Maloney Corporation manufactures plastic water bottles. It plans to grow by producing high-quality
water bottles at a low cost that are delivered in a timely manner. There are a number of other
manufacturers who produce similar water bottles. Maloney believes that continuously improving its
manufacturing processes and having satisfied employees are critical to implementing its strategy.
Required:
a.Is Maloney’s strategy one of product differentiation or cost leadership?
Explain briefly.
Identify at least one key element that you would expect to see included in the balanced scorecard
b.for the financial perspective.
c.for the customer perspective.
d.for the internal business process perspective.
e.for the learning and growth perspective.
82)
_____________
83)
An analysis of Louis Brown Corporation’s operating income changes between 2003 and 2004 show the following:
Operating income for 2003$1,000,000
Add growth component30,000
Add price-recovery component200,000
Deduct productivity component
(10,000)
Operating income for 2004$1,220,000
Required:
Is Louis Brown’s operating income gain consistent with the product differentiation or cost leadership strategy? Explain briefly. 83)
_____________
84)
An analysis of Gardner Corporation’s operating income changes between 2005 and 2006 show the
following:
Operating income for 2005 $1,000,000
Add growth component 50,000
Deduct price-recovery component (30,000)
Add productivity component
120,000
Operating income for 2006 $1,140,000
Required:
Is Gardner’s operating income gain consistent with the product differentiation or cost leadership strategy? Explain briefly.
84)
_____________
85)
An analysis of Gardner Corporation’s operating income changes between 2003 and 2004 show the following:
Operating income for 2003$1,000,000
Add growth component50,000
Deduct price-recovery component(30,000)
Add productivity component
120,000
Operating income for 2004$1,140,000
Required:
Is Gardner’s operating income gain consistent with the product differentiation or cost leadership strategy? Explain briefly. 85)
_____________
86)
Following a strategy of product differentiation, Despotovich Corporation makes a high-end Computer Monitor, CM12. The company presents the following data for the years 20×1 and 20×2.
20x120x2
Units of CM12 produced and sold5,0005,500
Selling price $400$440
Direct materials (pounds)15,00015,375
Direct materials costs per kilogram $40$44
Manufacturing capacity for CM12 (units)10,00010,000
Total manufacturing conversion costs$1,000,000 $1,110,000
Manufacturing conversion costs per unit of capacity$50$55
Selling and customer-service capacity (customers)6058
Total selling and customer-service costs$360,000$362,500
Cost per customer of selling & customer-service capacity$3,000$3,125
Despotovich Corporation produces no defective units but it wants to reduce direct materials usage per unit of CM12 in 20×2. Manufacturing conversion costs in each year depend on production capacity defined in terms of CM12 units that can be produced. Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support. Despotovich Corporation has 46 customers in 20×1 and 50 customers in 20×2. The industry market size for high-end computer monitors increased 5% from 20x1to 20×2.
Required:
a.Which of the following is a measure of the financial perspective?
b.Which of the following is a measure of the customer perspective?
c.Which of the following is a measure of the internal business perspective?
d.Which of the following is an objective of the learning and growth perspective? 86)
_____________
87)
Following a strategy of product differentiation, Instruments, Inc. makes a hand held calculator, II400. Instruments, Inc. presents the following data for the years 20×1 and 20×2.
20x120x2
Units of II400 produced and sold50,00052,500
Selling price$40$44
Direct materials (pounds)150,000153,375
Direct materials costs per kilogram$4.00$4.40
Manufacturing capacity for II400 (units)62,50062,500
Total manufacturing conversion costs$250,000$277,500
Manufacturing conversion costs per unit of capacity$8.00$8.80
Selling and customer-service capacity (customers)3029
Total selling and customer-service costs$180,000$181,250
Cost per customer of selling & customer-service capacity$12,000$12,500
Instruments, Inc. produces no defective units but it wants to reduce direct materials usage per unit of II400 in 20×2. Manufacturing conversion costs in each year depend on production capacity defined in terms of II400 units that can be produced. Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support. Instruments, Inc. has 23 customers in 20×1 and 25 customers in 20×2. The industry market size for hand held calculators increased 5% from 20x1to 20×2.
Required:
a.Which of the following is an objective of the internal business perspective?
b.Which of the following is a measure of the learning and growth perspective?
c.Which of the following is a measure of the financial perspective?
d.Which of the following is a measure of the customer perspective? 87)
_____________
Use the information below to answer the following question(s).
Following a strategy of product differentiation, Despotovich Corporation makes a high-end Computer Monitor, CM12. Despotovich Corporation presents the following data for the years 20×1 and 20×2.
20x120x2
Units of CM12 produced and sold5,0005,500
Selling price$400$440
Direct materials (pounds)15,00015,375
Direct materials costs per kilogram $40$44
Manufacturing capacity for CM12 (units) 10,00010,000
Total manufacturing conversion costs$1,000,000$1,110,000
Manufacturing conversion costs per unit of capacity $50$55
Selling and customer-service capacity (customers)60 58
Total selling and customer-service costs $360,000$362,500
Cost per customer of selling & customer-service capacity $3,000$3,125
Despotovich Corporation produces no defective units but it wants to reduce direct materials usage per unit of CM12 in 20×2. Manufacturing conversion costs in each year depend on production capacity defined in terms of CM12 units that can be produced. Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support. Despotovich Corporation has 46 customers in 20×1 and 50 customers in 20×2 . The industry market size for high-end computer monitors increased 5% from 20×1 to 20×2.
88)
Required:
a.What is the operating income for
20×1?
b.What is operating income in 20×2 ?
c.What is the change in operating income from 20x1to 20×2? 88)
_____________
89)
Required:
a.What is revenue effect of growth component?
b.What is the cost effect of growth component?
c.What is the net increase in operating income as a result of the growth component? 89)
_____________
90)
Following a strategy of product differentiation, Ernsting Corporation makes a high-end computer
monitor, CM12.
Ernsting Corporation presents the following data for the years 2007 and 2008:
20072008
Units of CM12 produced and sold5,0005,500
Selling price$400$440
Direct materials (pounds)15,00015,375
Direct materials costs per pound$40$44
Manufacturing capacity for CM12 (units)10,00010,000
Conversion costs$1,000,000$1,100,000
Conversion costs per unit of capacity$100$110
Selling and customer-service capacity (customers)6058
Total selling and customer-service costs$360,000$362,500
Selling and customer-service capacity cost per customer$6,000$6,250
Ernsting Corporation produces no defective units but it wants to reduce direct materials usage per unit of CM12 in 2008.
Manufacturing conversion costs in each year depend on production capacity defined in terms of CM12 units that can be produced.
Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support.
Ernsting Corporation has 46 customers in 2007 and 50 customers in 2008.
The industry market size for high-end computer monitors increased 5% from 2007 to 2008.
Required:
a.What is operating income for 2007?
b.What is operating income in 2008?
c.What is the change in operating income from 2007 to 2008?
90)
_____________
91)
Following a strategy of product differentiation, Ernsting Corporation makes a high-end computer
monitor, CM12.
Ernsting Corporation presents the following data for the years 2007 and 2008:
20072008
Units of CM12 produced and sold5,0005,500
Selling price$400$440
Direct materials (pounds)15,00015,375
Direct materials costs per pound$40$44
Manufacturing capacity for CM12 (units)10,00010,000
Conversion costs$1,000,000$1,100,000
Conversion costs per unit of capacity$100$110
Selling and customer-service capacity (customers)6058
Total selling and customer-service costs$360,000$362,500
Selling and customer-service capacity cost per customer$6,000$6,250
Ernsting Corporation produces no defective units but it wants to reduce direct materials usage per unit of CM12 in 2008.
Manufacturing conversion costs in each year depend on production capacity defined in terms of CM12 units that can be produced.
Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support.
Ernsting Corporation has 46 customers in 2007 and 50 customers in 2008.
The industry market size for high-end computer monitors increased 5% from 2007 to 2008.
Required:
a.What is the revenue effect of the growth component?
b.What is the cost effect of the growth component?
c.What is the net effect on operating income as a result of the growth component?
91)
_____________
