IOE 421 Final Exam GRADED A+
IOE 421 Final Exam GRADED A+
Which of the following are lenses for Strategic Cost Management? - Answer-Only A, B,
&C
Strategic Positioning Analysis is important ... ? - Answer-To understand which costs are
important and relevant to your firm.
Value Chain Analysis can help you understand ... ? - Answer-How you can--or should--
work with your supply chain partners.
Which of the following are true regarding Cost Drivers? - Answer-e. All of the above
Strategic Cost Management's most important role is to help you ... ? - Answer-Manage
your firm's value-creation capabilities.
The Producers Price Index (PPI) is . . .? - Answer-Benchmarking data for various
commodities.
The goal of price analysis ... ? - Answer-Is to understand if you are managing well the
prices you are paying in terms of market volatility.
Which of the following is NOT one of the steps in price analysis? - Answer-Call your
supplier and discuss changes in costs
Below are the market prices and historical prices three different commodity teams have
been paying. Which of the purchasing teams is performing the BEST? - Answer-Fuel
Given the following table, how would you characterize the performance of the
purchasing #2 diesel fuel commodity team? - Answer-Mediocre Job (i.e., will likely keep
job but no bonus)
Cost Analysis is used to: - Answer-Gain insight into individual cost elements that make
up a product
Manufacturing overhead is calculated as: - Answer-A percent of labor
Given an increase in manufacturing labor: - Answer-All of the above
Often the price a supplier requests because of increases in individual cost elements: -
Answer-Is higher than calculated based on the cost element change
Reverse engineering - Answer-All of above
, IOE 421 Final Exam GRADED A+
How do Total Landed Costs differ from Total Cost of Ownership? - Answer-Total Costs
of Ownership consider the net present value of money whereas total landed costs do
not.
Which of the following do Total Landed Costs and Total Costs of Ownership both
consider? - Answer-Only A, B, & C
Which of the following is the most difficult—and most important—step in performing a
total landed cost or total cost of ownership analysis? - Answer-Identifying the relevant
costs.
Cost Modeling ... ? - Answer-Can be used by any functional areas to understand the
costs of a product or process.
Which of the following is a critical step in using cost modeling to estimate a product or
component cost? - Answer-Map the process used to product/procure the component
There are many potential cost drivers. Which of the following should you exclude from
your analysis? - Answer-Emotion
A sensitivity analysis allows you to perform a "What if . . ." analysis on a product or
component cost. Which of the following is a typical "What if" scenario you should
consider? - Answer-What if supplier quality decreases?
Why do you perform Target Costing? - Answer-All of the above
Which of the following expresses the relationships that are essential to calculating target
cost? - Answer-Both C & D
In setting a target sales price there are a number of criteria to consider, which of the
following is not one of those? - Answer-How much profit you want
During execution of the target costing decision the primary objective is to . . .? - Answer-
. Reduce costs
Most companies possess pricing power. - Answer-False
When solving disputes in buyer-supplier relationships, ________________ should be
used as a last resort? - Answer-Going to Court
Which is not one of the conditions for a valid contract? - Answer-Purchase price
reductions
As a buying agent, whose "best interest" should you have in mind? - Answer-Your
Employers
IOE 421 Final Exam GRADED A+
Which of the following are lenses for Strategic Cost Management? - Answer-Only A, B,
&C
Strategic Positioning Analysis is important ... ? - Answer-To understand which costs are
important and relevant to your firm.
Value Chain Analysis can help you understand ... ? - Answer-How you can--or should--
work with your supply chain partners.
Which of the following are true regarding Cost Drivers? - Answer-e. All of the above
Strategic Cost Management's most important role is to help you ... ? - Answer-Manage
your firm's value-creation capabilities.
The Producers Price Index (PPI) is . . .? - Answer-Benchmarking data for various
commodities.
The goal of price analysis ... ? - Answer-Is to understand if you are managing well the
prices you are paying in terms of market volatility.
Which of the following is NOT one of the steps in price analysis? - Answer-Call your
supplier and discuss changes in costs
Below are the market prices and historical prices three different commodity teams have
been paying. Which of the purchasing teams is performing the BEST? - Answer-Fuel
Given the following table, how would you characterize the performance of the
purchasing #2 diesel fuel commodity team? - Answer-Mediocre Job (i.e., will likely keep
job but no bonus)
Cost Analysis is used to: - Answer-Gain insight into individual cost elements that make
up a product
Manufacturing overhead is calculated as: - Answer-A percent of labor
Given an increase in manufacturing labor: - Answer-All of the above
Often the price a supplier requests because of increases in individual cost elements: -
Answer-Is higher than calculated based on the cost element change
Reverse engineering - Answer-All of above
, IOE 421 Final Exam GRADED A+
How do Total Landed Costs differ from Total Cost of Ownership? - Answer-Total Costs
of Ownership consider the net present value of money whereas total landed costs do
not.
Which of the following do Total Landed Costs and Total Costs of Ownership both
consider? - Answer-Only A, B, & C
Which of the following is the most difficult—and most important—step in performing a
total landed cost or total cost of ownership analysis? - Answer-Identifying the relevant
costs.
Cost Modeling ... ? - Answer-Can be used by any functional areas to understand the
costs of a product or process.
Which of the following is a critical step in using cost modeling to estimate a product or
component cost? - Answer-Map the process used to product/procure the component
There are many potential cost drivers. Which of the following should you exclude from
your analysis? - Answer-Emotion
A sensitivity analysis allows you to perform a "What if . . ." analysis on a product or
component cost. Which of the following is a typical "What if" scenario you should
consider? - Answer-What if supplier quality decreases?
Why do you perform Target Costing? - Answer-All of the above
Which of the following expresses the relationships that are essential to calculating target
cost? - Answer-Both C & D
In setting a target sales price there are a number of criteria to consider, which of the
following is not one of those? - Answer-How much profit you want
During execution of the target costing decision the primary objective is to . . .? - Answer-
. Reduce costs
Most companies possess pricing power. - Answer-False
When solving disputes in buyer-supplier relationships, ________________ should be
used as a last resort? - Answer-Going to Court
Which is not one of the conditions for a valid contract? - Answer-Purchase price
reductions
As a buying agent, whose "best interest" should you have in mind? - Answer-Your
Employers
