Answered: There is a significant decrease in unit…

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter2: Accounting For Materials

Section: Chapter Questions

Problem 2MC

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Question

1. There is a significant decrease in unit sales. Which of the following would be the LEAST likely action among the different departments?

a. Consult with marketing and sales to determine whether there are changes in customer preferences.

b. Review changes in technology and determine whether there is obsolescense in the products and the production process

c. Inquire with the after-sales service whether there are indications of high level of unresolved customer complaints.

d. Communicate with inbound logistics and determine whether raw materials contributed to increase in product failure.

2. The internal cost analysis process involves the following in what order? (A) Identify the links between the process and check for opportunities to lower costs, (B) Identify the value creating processes and the cost of each, (C) Identify the cost driver for each process and the cost per activity level.

a. A, B, C
b. C, A, B
c. B, A, C
d. B, C, A

3. This stage of the product life cycle is evidenced by significant upfront cash outflow.

a. Growth
b. Decline
c. Introduction
d. Maturity

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