Comp XM questions and answers
graded a+
What are the aspects considered under a product's "promotion"
factor? - ANSWERS>>>>>Sales budget
Customer awareness deals with what?
What about customer accessibility? - ANSWERS>>>>>Awareness:
Promotion budget
Accessibility: Sales budget
For a product to be a worthy competitor it must have a survey
score over what? - ANSWERS>>>>>5
How can you tell how many different products are emerging next
year? - ANSWERS>>>>>No sales but have both capacity and
automation
How do you find ROS? - ANSWERS>>>>>Profit / Sales
What does ROS represent? (5)
,What kind of strategy usually has a high ROS? - ANSWERS>>>>>1.
Profit margin
2. % of every sales dollar that is profit
3. Indicator of competition within an industry
4. How hard we are working each dollar of sales
5. A pure income statement relationship
Strategy: differentiation with premium pricing
What makes up the DuPont Chain? (5)
What should they typically be? - ANSWERS>>>>>1. ROS
2. Asset turnover (above 1)
3. ROA
4. Leverage (1.8 - 2.8)
5. ROE
What can cause a low ROS? (6) - ANSWERS>>>>>1. Price too low
or expenses too high
2. Too much inventory
3. Too high depreciation
4. Too much idle capacity (increasing depreciation)
,5. Too much cash
6. Low CM
What is a low CM caused by?
How can you increase your CM? - ANSWERS>>>>>CAUSED BY:
1. Price too low
2. Variable expenses too high (labor, material, inventory carry)
INCREASE BY:
1. Increase price
2. Increase automation (lower labor costs)
3. Lower MTBF and position (lower material costs)
4. Forecast better (lower inventory carrying costs)
How do you find the asset turnover rate?
What does it represent? (2) - ANSWERS>>>>>Sales / Total assets
1. An efficiency measure
2. How hard we are working our assets to produce sales
, What can cause a firm's low asset turnover? (4) -
ANSWERS>>>>>1. Too much cash
2. Too high A/R
3. Too high inventory
4. Too much (idle) capacity/automation
How do you find a firm's A/R outstanding balance? -
ANSWERS>>>>>(AR / Sales) * 365
How do you find ROA? (2)
What does it represent? (2) - ANSWERS>>>>>1. Profit / Assets
2. ROS * asset turnover
Represents:
1. How good the company is at producing wealth with their assets
2. Comparison of the profits produced by firm and the asset base
What can case a low ROA? - ANSWERS>>>>>Low ROS
1. Price too low or expenses too high
2. Too much inventory
3. Too high depreciation
4. Too much idle capacity (increasing depreciation)
graded a+
What are the aspects considered under a product's "promotion"
factor? - ANSWERS>>>>>Sales budget
Customer awareness deals with what?
What about customer accessibility? - ANSWERS>>>>>Awareness:
Promotion budget
Accessibility: Sales budget
For a product to be a worthy competitor it must have a survey
score over what? - ANSWERS>>>>>5
How can you tell how many different products are emerging next
year? - ANSWERS>>>>>No sales but have both capacity and
automation
How do you find ROS? - ANSWERS>>>>>Profit / Sales
What does ROS represent? (5)
,What kind of strategy usually has a high ROS? - ANSWERS>>>>>1.
Profit margin
2. % of every sales dollar that is profit
3. Indicator of competition within an industry
4. How hard we are working each dollar of sales
5. A pure income statement relationship
Strategy: differentiation with premium pricing
What makes up the DuPont Chain? (5)
What should they typically be? - ANSWERS>>>>>1. ROS
2. Asset turnover (above 1)
3. ROA
4. Leverage (1.8 - 2.8)
5. ROE
What can cause a low ROS? (6) - ANSWERS>>>>>1. Price too low
or expenses too high
2. Too much inventory
3. Too high depreciation
4. Too much idle capacity (increasing depreciation)
,5. Too much cash
6. Low CM
What is a low CM caused by?
How can you increase your CM? - ANSWERS>>>>>CAUSED BY:
1. Price too low
2. Variable expenses too high (labor, material, inventory carry)
INCREASE BY:
1. Increase price
2. Increase automation (lower labor costs)
3. Lower MTBF and position (lower material costs)
4. Forecast better (lower inventory carrying costs)
How do you find the asset turnover rate?
What does it represent? (2) - ANSWERS>>>>>Sales / Total assets
1. An efficiency measure
2. How hard we are working our assets to produce sales
, What can cause a firm's low asset turnover? (4) -
ANSWERS>>>>>1. Too much cash
2. Too high A/R
3. Too high inventory
4. Too much (idle) capacity/automation
How do you find a firm's A/R outstanding balance? -
ANSWERS>>>>>(AR / Sales) * 365
How do you find ROA? (2)
What does it represent? (2) - ANSWERS>>>>>1. Profit / Assets
2. ROS * asset turnover
Represents:
1. How good the company is at producing wealth with their assets
2. Comparison of the profits produced by firm and the asset base
What can case a low ROA? - ANSWERS>>>>>Low ROS
1. Price too low or expenses too high
2. Too much inventory
3. Too high depreciation
4. Too much idle capacity (increasing depreciation)
