Unit 3 - Module 3

Question 1

What is a sales budget?

Answer 1

Forecasted revenue based on previous years data + anticipated growth. Sales Budget has to be completed prior to the production budget/plan.

Question 2

What is a production budget?

Answer 2

Forecasted costs associated with production of inventory to meet the sales expectations.

Question 3

What is the direct materials budget?

Answer 3

Cost of raw goods/materials needed in the manufaciring process. Only takes into consideration costs that have a direct connection to the product.

Question 4

What is the direct labor budget?

Answer 4

Cost of labor directly associated with production

Question 5

What is the manufacturing overhead budget?

Answer 5

All other costs not directly associated with manufacturing. Admin, taxes, utilities.

Question 6

What is the selling and administrative budget?

Answer 6

Predicted costs for advertising, marketing, corporate salaries, etc.

Question 7

What is the budgeted income statement?

Answer 7

Financial report of the net income generated by a company, including revenues and expenses.

Question 8

What is the Capital Expenditures Budget?

Answer 8

Planned expenditures for large cost items. New equipment, new locations, etc.

Question 9

What is the cash budget?

Answer 9

Breakdown of revenue and expenditures. Will include A/R, A/P, finance expenses, capital asset valuation.

Question 10

What is a balance sheet?

Answer 10

A snapshot of assets, liabilities and stockholder equity. Only applies to the day the report was run.

Question 11

What is the statement of cash flows?

Answer 11

Essentially a report card that summarizes how well a company is managing the amount of cash or cash equivalents leaving and entering the company.

Question 12

List Porter’s three most effective strategies

Answer 12

Cost leadership
Diffferentiation
Market segmentation.

Question 13

Describe the cost leadership strategy.

Answer 13

Is about producing large quantities of goods very efficiently in order to have a low price point. Higher volume / low production cost / low price point on goods. (Wal-Mart)

Question 14

Describe differentiation strategy.

Answer 14

Is about marketing and branding. It sells less goods at higher prices by appealing to customers desire for ‘status’. (Rolex, Berkin)

Question 15

Describe market segmentation.

Answer 15

Finding a niche, it’s narrowly focused on a specific product or service. (Ulta, Doc Marten, Party City)

Question 16

Bruce is developing quantitative statements to evaluate an organization’s department and employees progress toward meeting their goals. This is an example of:

a. Strategic objectives & analysis
b. Strategic formulation
c. Strategic implementation
d. Strategic evaluation

Answer 16

b. Strategic formulation

Question 17

Developing a well-integrated company using corporate strategies, producing products and services with a focus on customer satisfaction, maximizing the organization’s core competencies, and creating a system to measure competitive priorities are known as?

a. Operational strategies
b. Corporate strategies
c. Business strategies
d. Competitive strategies

Answer 17

a. Operational strategies

Question 18

What type of plan or goal focuses on long-term goals, performance measures and major projects for the organizational to accomplish within a certain period of time?

a. Operational plan
b. Tactical plan
c. Strategic plan
d. SMART goal

Answer 18

c. Strategic plan

Question 19

Milo is a CEO for Best Company, he needs to show the change in the financial status of the organization over a specific period of time. Milo will need to prepare what type of statement?

a. Income Statement
b. Cash Flow
c. Balance Sheet
d. Sales Plan

Answer 19

a. Income Statement

Question 20

A budget should describe management’s______relating to the state of the economy over the planning horizon.

a. Cash flow
b. Assets/liabilities
c. Assumptions
d. Current profit

Answer 20

c. Assumptions

Question 21

A budget a company uses to make sure its expenses fall within financial parameters. It can also be used to evaluate an organization’s success and operationalize its strategy is called______?

a. Operating Budget
b. Financial Budget
c. Sales Budget
d. Master Budget

Answer 21

d. Master Budget

Question 22

Which information does a projected income statement report as a function of the budget-planning process?

Deferred revenue
Current profit
Market share
Sales plan

Answer 22

Current profit
The projected income statement contains sales and other data from the previous financial period. This provides information on current profit and expenses.

Question 23

What are the two major components of the master budget?

Direct materials and overhead budget
Financial and operating budgets
Capital expenditures and cash budgets
Selling and administrative budgets

Answer 23

Financial and operating budgets

The master budget is composed of the operating budget and the financial budget.

Question 24

What is the difference between financial accounting and managerial accounting?

Answer 24

Financial accounting are for people external to the company.

Managerial accounting is for internal use.

Question 25

What is the master budget?

Answer 25

Budget composed of all the lower level budgets, financial statements, cash flow, and financial plans

Question 26

What is the difference between an income statement and a balance sheet?

Answer 26

The income statement shows the change in the financial statu(last year, last quarter) The balance sheet provides a snapshot of where the company stands in that specific moment.

Question 27

What is a pro-forma?

Answer 27

A financial report based on hypothetical scenarios

Question 28

What are the 2 main companents of the master budget?

Answer 28

The operating budget and the financial budget.

Question 29

What are the 4 phases of the Deming cycle?

Answer 29

Planning, doing, checking, and acting

Question 30

What does phase one of the Deming cycle define?

Answer 30

Planning: | Developing a mission and vision statement, clear objectives, and a strategy for reaching their goals.

Question 31

What does phase two of the Deming cycle define?

Answer 31

Doing Managers use the data they have gathered, both financial and nonfinancial, to monitor their department's progress toward fulfilling the goals of the organization.

Question 32

What does phase three of the Deming cycle define?

Answer 32

Checking | Setting a budget, monitoring progress, and checking milestones are all ways that managers can check their progress.

Question 33

What does phase four of the Deming cycle define?

Answer 33

Acting Act on the information they receive. They can reallocate resources, change processes, or reassign employees to tasks to lower costs or make sure costs stay within the parameters of the budget.

Question 34

Name the 3 different types of changes that can be made in an organization.

Answer 34

Structural Technical Cultural

Question 35

"The Deming cycle consists of ________________Which of the following. a. Planning, organizing, directing, controlling b. Organizing, doing, setting, acting c. Planning, doing, checking acting d. Organizing, doing, checking, acting"

Answer 35

c. Planning, doing, checking acting

Question 36

"Decision-making in many departments of an organization is based on the ____________? a. Cash flow b. Sales forecast c. Operating forecast d. Production budget"

Answer 36

b. Sales forecast

Question 37

A_______cost is any cost resulting from a missed opportunity that cannot be recovered. a. Opportunity cost b. Variable cost c. Fixed cost d. Sunk cost

Answer 37

d. Sunk cost

Question 38

Name the Leadership Strategies (six components) for Change in Organizations.

Answer 38

``` Outline a strategy Communicate effectively Empower employees Counter resistance Support employees Track progress ```

Question 39

List Conners Leadership styles for change management

Answer 39

``` Anti-change Rational Panacea Bolt on Integrated Continuous ```

Question 40

What are the characteristics of a Rational Change Management Leader?

Answer 40

Control change with logical planning. | The 'this is what we've been told to do and this is how we are going to do it' guy.

Question 41

What are the characteristics of an Integrated Management Leader?

Answer 41

Combines human concerns and strategy. This leadership approach focuses on the roles, capabilities, and attitudes of its people as change projects are created and implemented. The concept is to combine human and cultural concerns with the strategy itself.

Question 42

What are the characteristics of a Continuous Management Leader?

Answer 42

Agile and quick responding. This type of leader believes that change is contant and necessary.They focus the change at hand while maintaining, and building, the adaptation capacity needed moving forward.

Question 43

What are the characteristics of a Panacea Management Leader?

Answer 43

Communicate and motivate. This leader focuses on the people not the process. This leader is sympathetic to the challenges ahead for the employees during the change process. his is the change leader of coffee mugs, t-shirts, and “let them vent” sessions.

Question 44

"An urgent care center is planning to change from being open eight hours on the weekend to 24-hour coverage. Which step should leadership take at this point to overcome barriers in this change process? a) Hire staff willing to adapt to the schedule b) Engage a human resource consultant c) Revise tactics to meet strategic objectives d) Understand the root cause of resistance"

Answer 44

d) Understand the root cause of resistance

Question 45

"An organization is considering a broad new initiative to change its existing culture into one that delivers high performance. The leader of the change process would like to assess the need for change and determine factors that would help reduce potential resistance. Which process should this leader use to meet this objective? a) Requiring employees to attend mandatory diversity and inclusion training b) Providing a severance package to displaced workers and assisting with job searches c) Creating a history of success that demonstrates how the change effort is expected to progress d) Identifying potential naysayers and encouraging them to leave the organization prior to implementation"

Answer 45

c) Creating a history of success that demonstrates how the change effort is expected to progress

Question 46

"Sally is the CEO of Paint Industry. She is known throughout her organization for promoting and instilling a culture that is most conducive to both the strategy and objectives of the organization over the long term. Sally personifies managers who are aware of: a. their role as cultural ambassadors b. promoting a robust authoritarian hierarchy c. innovation that is contradictory to employee interests "

Answer 46

a. their role as cultural ambassadors

Question 47

"What is a purpose of the first step in Lewin’s change model? a) Understanding the change obstacles b) Demonstrating the urgency for change c) Creating a change history of small wins d) Rewarding people who embrace change"

Answer 47

b) Demonstrating the urgency for change

Question 48

A significant change in a company’s billing process was recently implemented. Which component of change management should be used now? 1. Create a clear strategy 2. Track progress 3. Communicate effectively 4. Empower employees

Answer 48

2. Track progress Management will want to closely monitor the changes to be sure the intended result is being achieved. This involves talking with employees and determining if small changes are needed to improve efficiency and customer satisfaction.

Question 49

Which leadership style considers company culture and employee attitudes when making process changes? 1. Integrated 2. Panacea 3. Rational 4. Continuous

Answer 49

1. Integrated An integrated leader incorporates knowledge of the culture, people's feelings about change, and other aspects of human capital when initiating and making changes