Question: 1. The strategy of segmenting demand is

> Mercy Hospital uses a costing system to determine the cost of patients who have surgery. The hospital uses a budgeted indirect cost rate for allocating indirect costs to patient stays. In March, the operating theatre had a budgeted allocation base of 100

> A housekeeping support department budgets its costs at $20 000 per month plus $18 per hour. The estimated and actual hours for November provided by the housekeeping support department to three operating departments are as follows. Required (a) Draw a di

> During 2022, Lavender Plantations Pty Ltd continued to grow. The manager decided to add detergents to its existing range of soap and candles. The management accountant, Nick Gee, expressed concern regarding the accuracy of the product costing system now

> Refer to exercise 11.20. Benson Manufacturing’s total direct labour cost was $470 000 (2350 hours × $100 per hour). There was no direct labour cost variance. In exercise 11.20 Benson Manufacturing estimates the following activity for the coming year. •

> Benson Manufacturing estimates the following activity for the coming year. • Expected production 23 000 units • Expected direct labour hours 1750 hours • Expected manufacturing overhead $92 000. Manufacturing overhead is allocated on the basis of direct

> Megan Mitchell has recently graduated from a business school and joined the family business as an accountant. At the first management meeting with production, marketing and sales, a great deal of time is spent discussing the unit cost of products. What k

> Fruits on High Ltd uses three activity cost pools to assign costs to customers in order to assess customer profitability. Each activity cost pool has a unique cost driver to apply indirect costs to customers. Required Calculate the activity cost rate fo

> What are avoidable costs and why are they important in decision making?

> The Skin Care Company has one product line that is unprofitable. What circumstances might cause the entity’s overall profit to be lower if the unprofitable product line was eliminated?

> Refer to exercise 11.15. For each activity, name a cost driver that might be used to assign activity costs to products. In exercise 11.15 Hartford Company manufactures five products in a single production facility. The company uses activity cost pools t

> Hartford Company manufactures five products in a single production facility. The company uses activity cost pools to allocate indirect costs. The following activities have been identified following an analysis of the entity operations. Required Classify

> Michelle’s Tax Services has two departments, tax and audit. The tax department has two product lines, business returns and individual returns. A list of costs and three cost objects from Michelle’s Tax Services are sho

> Assess the benefits to an entity of using a costing system.

> Identify two factors that influence pricing decisions.

> Discuss the allocation process for indirect costs.

> Briefly outline four pricing practices that are illegal in Australia.

> Refresh Company produces plunge pools. Currently, the company uses internally manufactured pumps to power water jets. Refresh Company has found that 40 per cent of the pumps failed within their 12-month warranty period, causing huge warranty costs. Becau

> You are the adviser to a junior achievement group in a local high school. You need to help the group make a decision about fees that must be paid to sell gardening tools at the Home and Garden Show. The group sells a set of tools for $20. The manufacturi

> How may an opportunity cost be relevant in an outsourcing decision?

> Barloo Company is a software producer and sales company. Currently, it pays all sales staff on a fixed base salary. Recently, management have been considering switching sales staff across to an incentive-based reward system. Barloo’s ch

> Continuing the example in 10.59, the other option Katy is exploring is to offer a wider product range including two other specialist bikes: adult mountain bikes and adult road bikes. From her investigations, she realises this is a highly competitive part

> Katy Davis has had a passion for cycling for years. She has decided to explore turning her passion into a business. She has spent the last few months exploring the industry and collecting information to facilitate decisions about the focus of the busines

> Leonardo Company has the capacity to manufacture 250 000 units annually of its only product. The following information is available. Selling price …………………………………………………………….. $130 per unit Variable manufacturing costs ……………………………………… $60 per unit Fixed man

> McDonald Services offers three core accounting and bookkeeping services. After a cost behavior study, the following profitability analysis has been prepared. The management of McDonald Services estimate that the total fees mix (52% : 28% : 20%) is gener

> The statement of profit or loss for Nambour Industries for 2019 is as follows. Cost behaviour seems to follow this pattern: all of the cost of sales is considered variable; 50 per cent of the total marketing and distribution costs are variable; and 40 p

> Tropical Processing is a single-product entity and provides the following summary data relating to its product for 2020. Selling price per unit ……………&acir

> Wynham Stereos produces and sells speakers and CD players. The following information about the costs related to the systems has been collected. Wynham Stereos normally produces 25 000 of these systems per year. The managers have recently received an off

> The management of York Company have asked for your assistance in deciding whether to continue manufacturing a part or buy it from an outside supplier. The part, called Beta B, is a component of York’s finished product. Analysis of the accounting records

> Soft Pearl Company incurs the following costs to produce 50 000 light switches for floor lamps in 2020. Direct materials ………………………………………….. $200 000 Direct labour ………………………………………………… 300 000 Variable manufacturing overhead …………………… 160 000 Fixed manufact

> Under what circumstances can calculating the contribution margin ratio to perform break-even analysis be useful?

> Juices R Us sells bottles of freshly squeezed juice to small convenience stores throughout Melbourne. Its latest statement of profit or loss for the last 12 months is as follows. Required (a) Calculate the contribution margin per juice bottle. (b) Calcu

> 13. Three elements (the service organization, the contact personnel and the customer) interact in the service encounter triad shown below. Which position represents the customer? 14. Employee empowered service companies have committed to all but one of

> 1. A customer who is interested in the self-service option would find which of the following dimensions of service most important? a. Risk involvement b. Customer's control of the situation c. Amount of time involved d. Efficiency of the service process

> 12. A service blueprint with a large number of intricate steps is considered to have a a. High degree of divergence. b. Low degree of complexity. c. High degree of complexity. d. Low degree of divergence. 13. The new service development process cycle con

> 1. Which of the following is not a characteristic of a production-line approach to provide a service? a. Division of labor b. Substitution of technology for people c. Standardization of the process and service provided d. High employee autonomy in task e

> 12. Services can create barriers to entry by __________ a. Using economies of scale. b. Creating switching costs. c. Using databases and information technology. d. All of the above. 13. Which of the following is an example of the competitive use of infor

> 11. Which one of the following attributes is not considered in the selection of a project manager? a. Credibility. b. Originality. c. Sensitivity. d. Ability to handle stress. 12. The four sequential stages of team development include all but one of the

> 1. Which of the following is not true about a critical path in a project network with certain activity times? a. Activities on the critical path have the least slack. b. The longest activity in the project must lie on the critical path. c. There can be s

> 11. The elimination of paper-based documents between organizatins is made possible by: a. ERP. b. EDI. c. MRP. d. POS. 12. Service level influences _______ and ________. a. Reorder point, safety stock b. Reorder point, backorder quantity c. Safety stock

> 1. Which one of the following is not a role that inventories play in a distribution system? a. Decoupling b. Speculative c. Anticipative d. Cyclical 2. In the design of an inventory system all but one of the following is considered: a. Type of customer

> 11. All of the following are forecasting models, except: a. Subjective. b. Objective. c. Causal. d. Time series. 12. Demand for hotel services will require the use of which one of the following forecasting models: a. Subjective and causal. b. Subjective

> 1. Long-term forecasts do not deal with predictions for: a. New services. b. Changes in mix of services. c. Overtime or temporary labor requirements. d. Process technology. 2. Subjective forecasting models are best characterized by: a. The use of experts

> 11. The cost of service capacity is determined by a. The number of customers waiting. b. The total number of customers. c. Waiting time. d. The number of servers on duty.* 12. Queuing models can help explain all but one of the following: a. Predicting re

> 1. A queuing system is said to be in a transient condition when: a. Its parameters change with time. b. Its parameters remain constant. c. It is still under the influence of the initial state.* d. It grows beyond bound. 2. The A/B/C notation classifies q

> 11. Which queue configuration permits opportunities for division of labor and service differentiation? a. Multiple queue b. Single queue c. Take a number d. Self-serve 12. One advantage of the multiple queue compared to a single queue is that multiple qu

> 1. The calling population is termed finite when: a. There is restriction on the maximum number in the queue. b. Only a limited number of people may use the facility in any given period. c. The interarrival time is not very large. d. There is no queue di

> 14. Which one of the following is not a characteristic of firms using yield management? a. Ability to segment their market b. Perishable inventory c. Variable capacity d. Product sold in advance 15. Which one of the following is not an example of the dif

> 11. Global service strategies include all but one of the following: a. Exporting services b. Following your customers c. Beating-the-clock d. Service offshoring 12. Mayo Clinic is a service firm that would fall under which of the following categories: a.

> 14. Which among the following strategies is used by fast-food restaurants to reduce costs? a. Increase advertising via the Internet. b. Allowing the customer to play an active part in the service process. c. Increase prices. d. Increasing menu items to

> 1. Which of the following is not one of the major considerations in planning multinational operations? a. Cultural transferability b. Technological compatibility c. Network development d. Host government policy 2. Multinational expansion by a service fir

> 14. Which of the following service providers likely would be involved in a single-level bi-directional service supply relationship? a. Pharmacy b. Professor c. Garage d. Mortgage company 15. All but one of the following is a managerial implication of bi-

> 1. The physical goods supply chain contains all but one of the following elements: a. Competitor. b. Distributor. c. Retailer. d. Customer. 2. The impact of the production element on physical goods supply chain management was _____ before and _____ after

> 11. In the Huff retail location model, the value of ( estimates ______________ a. Amount of travel time to reach a service facility. b. The importance of convenience in attracting customers. c. The importance of travel time in attracting customers. d. Th

> 1. A strategy that can be used by urban retailers to locate multiple sites close to each other in high-density areas despite the potential for cannibalization is called a. Competitive clustering. b. Marketing intermediaries. c. Saturation marketing. d. S

> 1. Data Envelopment Analysis (DEA) is a method for: a. Measuring a firm's quality performance by comparing it with other companies that are recognized as "best in class." b. Determining the feasibility of technological innovations in service operations.

> 11. Which quadrant in the matrix below represents attributes of a good service guarantee? No Conditions Many Conditions No Conditions Many Conditions  Complex Detailed (a) (b)  Clear Precise  (c) (d)   12. Which of the following is a strat

> 1. Which of the following dimensions of service quality is most important to customers? a. Empathy b. Assurance c. Reliability d. Tangibles 2. Which of the following is not an advantage of offering a service guarantee? a. It acts as a mechanism to differ

> 11. What defines the capacity of a service product layout? a. The activity requiring the most time per customer. b. The size of the queue. c. How tasks are allocated among servers. d. Ability of workers to change the process speed. 12. In the design of a

> 1. Which one of the following is not a major factor that could influence facility design? a. Objectives and nature of the service b. Flexibility in operations c. Availability of land d. Site location 2. A product layout would facilitate the concept of: a

> 1. The service package consists of five features. Which one of the features listed below is not included in the package? a. Explicit services b. Supporting facility c. Information d. Cost of service 2. The major input into a large public hospital from a

> 1. The corporate culture of a firm does not significantly influence the quality of the service it provides because the culture is internal and, therefore, not perceived by the customer. 2. Flexibility in meeting customer needs is the main reason that som

> 14. A service blueprint will not facilitate creative problem solving because it will be too rigid a definition of the service delivery system. 15. Investment banking is a financial service that has high complexity and high divergence. 16. Limited discret

> 1. The "line of visibility" found in a service blueprint separates the front office operations from the back office operations. 2. A factor that simplifies the design of service systems is the presence of the customer in the process. 3. A “line of intera

> 11. Selling information and developing new services are examples of the role that information technology plays in generating revenue. 12. Information technology can be used to promote customer loyalty. 13. The IRS has identified frequent-user programs

> 1. A characteristic of the overall cost leadership strategy is the incurring of start-up losses to build market share. 2. On-line networks between suppliers and their customers create a barrier to entry. 3. When pursuing a differentiation strategy, a ser

> 31. A highly scalable firm such as Kelly Blue Book (kkb.com) requires a call center. 32. Scalability is enhanced with self-service. 33. Customers seldom take note of firms that are leaders in the sustainability movement. 34. Recycling paper and reducing

> 11. The single important attribute of a project manager is leadership ability. 12. Schedule variance is the difference between budgeted cost for work performed and actual cost of work performed. 13. The term calendar is used in project management to ke

> 1. The critical path for a project with uncertain activity times is not known for certain until after the project is completed. 2. A project can be defined as a set of complex interrelated tasks with different requirements regarding activity time and re

> 11. POS scanning is used to initiate a purchase order to a pre-approved vendor automatically when the stock levels are depleted (or reach a reorder point). 12. Information management has been the key in allowing services to meet customer demands without

> 21. World-class service operations strive to replace workers with enhanced automation. 22. Firms classified as "available for service" view quality improvement efforts with disdain. 23. For a firm achieving "journeyman" competitive status, the back-offic

> 1. Point-of-sale scanning became feasible only when industry agreed upon a universal system of bar coding. 2. One role of holding inventory is to hedge against anticipated increases in the cost of the inventoried items. 3. Inventory management is concern

> 11. Fast-food restaurants use a causal model to forecast daily demand for menu items. 12. Subjective models are used to assess the future impact of changing demographics. 13. Costs for preparing time-series forecasts generally are lower than for other mo

> 1. Because of the nontangible nature of a service, forecasting does not play as important a role in service operations as in manufacturing operations. 2. The trade-off to be made with respect to accuracy is between the costs of inaccurate forecasts and t

> 14. When Xerox Corporation introduced the Model 9200 Duplicating System, the level of service dipped because technical representatives were assigned to territories. 15. The average time a customer should expect to wait can be calculated using just the me

> 1. Capacity planning decisions deal implicitly with decisions on the cost of making consumers wait and the extent to which these costs can be borne. 2. A system is said to be in a transient state when the values of its governing parameters in this state

> 1. Waiting is often seen as psychological punishment because the consumer is aware of the opportunity cost of waiting time and the resulting loss of earnings. 2. The net result of waiting, apart from the boredom and frustration experienced by the consume

> 12. Yield management is a pricing and capacity allocation system that was developed by American Airlines. 13. Yield management is a strategy that manages both demand and capacity. 14. An example of segmenting demand is seen when movie theaters offer mati

> 1. The use of a ski-resort hotel for business conventions during the summer is an example of using the complementary service strategy. 2. Overbooking is a strategy that can be used to smooth demand. 3. The strategy of segmenting demand to reduce variatio

> 11. A diversified network is a situation where many services are offered at a single location. 12. Franchising usually is used when developing a focused network. 13. A family restaurant is an example of a focused service. 14. Communication is included in

> 1. Network development is a consideration in the decision to plan a multinational service. 2. When a firm offers multiple services at a single location, it is using a clustered service strategy. 3. A franchise is a low risk investment, because the franch

> 14. Retail and wholesale trade had the greatest percentage of U.S. employment by industry in 2014. 15. From a marketing perspective, services, unlike goods, involve transfer of ownership. 16. It is convenient and often necessary to combine the operations

> 14. Customer-supplier duality acknowledges the customer inputs in a service relationship. 15. A bank is an example of a service provider with a single-level bi-directional service supply relationship. 16. Transfer enhances productive capacity by enabling

> 1. In the physical goods supply chain, information moves to the left and material to the right. 2. Customer demand variability is the most difficult factor to determine in a goods supply chain. 3. In the past, the flow of goods in a physical supply chain

> 11. Geographic information systems are a visual method of displaying data. 12. Cross-median is an approach to the location of a single facility using the metropolitan metric to maximize the total distance traveled. 13. Marketing intermediaries are busin

> 1. Finding a unique set of sites in a multi-location problem is a simple extension of the methods used for single facility location. 2. When a customer travels to the service facility, the direct cost that is incurred is the decrease in potential custome

> 1. DEA circumvents the need to develop standard costs for each service when comparing the efficiency of multiple service units that provide similar services. 2. Data envelopment analysis (DEA) is best used in an environment of low divergence and high com

> 11. Serving complimentary drinks on a delayed flight is an example of empathy being shown by the service personnel to the irate customer. 12. In the service quality gap model, GAP1 arises because of the management’s lack of understanding about how custom

> 1. The concept of quality service deployment is based on the belief that services should be designed to reflect customer requirements. 2. Being meaningful and easy to invoke are important elements of a good unconditional service guarantee. 3. A process i

> 14. The procedure to improve flow distance in a process layout by arranging the relative location of departments is known as operations sequence analysis. 15. A product layout affords some degree of customization. 16. Mid-Columbia Medical Center has a sp

> 1. The servicescape can influence perceived quality. 2. The design of facilities is dependent entirely on the construction and operating costs of the facilities. 3. A well-conceived servicescape can communicate desired customer behavior. 4. Heuristic alg

> 14. Internet banking is a service that would appeal to the economizing customer, the personalizing customer, and the convenience customer. 15. Efficiency- versus-satisfaction is the possible source of conflict in the relationship between the customer and

> 1. Services are deeds, processes, and performances. 2. The Clark-Fisher hypothesis notes the shift of employment from one sector of the economy to another. 3. The fall in employment in the agricultural sector is the primary reason for the increase in se

> 1. Who are Goodwill’s customers and how have their demo-graphics changed over time? 2. How should the introduction of for-profit thrifts affect Goodwill’s decisions about the role of customer service? 3. How can Goodwi

> 1. Marketing analysts use market position maps to display visually the customers’ perceptions of a firm in relation to its competitors regarding two attributes. Prepare a market position map for Alamo Draft house using “food quality” and “movie selection

> 1. For the Burger Palace example, perform a complete analysis of efficiency improvement alternatives for unit S2, including determination of a composite reference unit. 2. For the Burger Palace example, perform a complete analysis of efficiency improveme

> 1. Compare and contrast the strategic service vision of El Banco and United Commercial Bank. 2. Identify the service winners, qualifiers, and service losers for El Banco and United Commercial Bank. 3. What are the differentiating features of banks tha

> 1. Use DEA to identify efficient and inefficient terminal operations. Formulate the problem as a linear programming model, and solve using computer software such as Excel Solver that permits input file editing between runs. 2. Using the appropriate refer

> 1. Assume that you are part of the management staff whose task is to develop this sketch plan. Using Microsoft Project, develop the PERT network as outlined above, identify the critical path, and determine the expected time to reach basic operational sta

> 1. Using Microsoft Project, prepare a network and identify the critical path activities, the expected project duration, and scheduling times for all activities. 2. The elapsed time for delivery of the hardware is estimated at 90 days. Would the project c

> Located in a major southwestern U.S. city, Elysian Cycles (EC) is a wholesale distributor of bicycles and bicycle parts. Its primary retail outlets are located in eight cities within a 400-mile radius of the distribution center. These retail outlets gene