When Companies Engage in Value-Creating Activities, They Do So by

question 80

Multiple Choice

When companies engage in value-creating activities, they do so by

• A)focusing on exploiting a company's best-executed operating strategy.
• B)concentrating on efficient performance of the company's primary value chain activities.
• C)concentrating on minimizing the costs associated with the design of a product or service.
• D)drawing on specific company resources and capabilities that underlie and enable the activity.
• E)focusing on working with forward-channel allies to develop capabilities to outmatch the capabilities of rivals.

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Definitions:

Supplies

Items or materials used in the operation of a business and often classified as a type of inventory on the balance sheet.

Variable Manufacturing Overhead

Costs in the manufacturing process that vary with the level of production output, such as utilities or indirect materials, but do not directly correlate to specific units of production.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the standard cost allocated, based on the actual activity level.

Variable Overhead Standards

The predetermined costs associated with variable overheads that are expected to be incurred under normal operating conditions.