Activity-Based Management Information Can Be Used in Several Ways, Including

question 134

Short Answer

Activity-based management information can be used in several ways, including managing quality costs. Various quality-related costs are listed below. Indicate whether each cost most likely relates to a(n): (A)prevention activities, (B)appraisal activities, (C)production activities, or (D)post-sales activities.
____ 1. Routine equipment maintenance
____ 2. Finished product testing before shipment
____ 3. Customer satisfaction surveys
____ 4. Costs of spoilage and rework
____ 5. Warranty repairs
____ 6. Incoming raw materials testing
____ 7. Costs incurred to establish supplier qualifications
____ 8. Extra shipping costs incurred to meet customer deadlines
____ 9. Machinery repair costs
____ 10. Salaries of quality control inspectors

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Definitions:

Industry Attractiveness

A measure of the potential profitability and prospects for growth within a particular industry or market sector.

Bargaining Power of Buyers

The influence that customers have over a producing industry, often affecting pricing, quality, and terms of sale.

Degree of Rivalry

The extent and intensity of competition among businesses within the same industry.

Substitute Products

Goods or services that can be used in place of each other, offering consumers alternatives in their purchasing choices.