ADMS 3510 – Past Mid Terms
Unit 1: Management Accounting and the Case Study Method
Question 1.1.
Porter explains that there are five forces that determine industry attractiveness and long-run
industry profitability. Please indicate which ONE of the following is NOT a competitive force:
a) The threat of entry of new competitors (new entrants)
b) The threat of substitutes
c) The bargaining power of suppliers
d) The degree of rivalry between customers
e) The degree of rivalry between existing competitors
ANS: d
Question 1.2.
Indicate which ONE of the following issues is relevant when considering the analysis of new
entrants:
a) Is there overcapacity in our industry?
b) How likely are our customers to switch to competitors’ products or services?
c) How difficult would it be for a new competitor to imitate the way we do business?
d) What supply factors are critical to us: quality, price, reliability, service and so forth?
e) How do we appeal to different segments of the market? Why do they buy our product or
services?
ANS: c
Question 1.3.
Indicate which ONE of the following issues is relevant when considering the analysis of substitute
products or services:
a) How difficult would it be for a new competitor to imitate the way we do business?
b) How likely are our customers to switch to competitors’ products or services?
c) How do we appeal to different segments of the market? Why do they buy our product or
services?
d) Is there overcapacity in our industry?
e) What supply factors are critical to us: quality, price, reliability, service and so forth?
ANS: b
, ADMS 3510 – Past Mid Terms
Question 1.4.
Indicate which ONE of the following issues is relevant when considering the analysis of
customers:
a) What supply factors are critical to us: quality, price, reliability, service and so forth?
b) How likely are our customers to switch to competitors’ products or services?
c) How do we appeal to different segments of the market? Why do they buy our product or
services?
d) Is there overcapacity in our industry?
e) How difficult would it be for a new competitor to imitate the way we do business?
ANS: c
Question 1.5.
Indicate which ONE of the following issues is relevant when considering the analysis of suppliers:
a) What supply factors are critical to us: quality, price, reliability, service and so forth?
b) How likely are our customers to switch to competitors’ products or services?
c) How do we appeal to different segments of the market? Why do they buy our product or
services?
d) Is there overcapacity in our industry?
e) How difficult would it be for a new competitor to imitate the way we do business?
ANS: a
Question 1.6.
Indicate which ONE of the following issues is relevant when considering the analysis of the
competitors in the industry:
a) What supply factors are critical to us: quality, price, reliability, service and so forth?
b) How likely are our customers to switch to competitors’ products or services?
c) How do we appeal to different segments of the market? Why do they buy our product or
services?
d) Is there overcapacity in our industry?
e) How difficult would it be for a new competitor to imitate the way we do business?
ANS: d
, ADMS 3510 – Past Mid Terms
Question 1.7.
Given the following comparative data of two projects please answer the following questions
First alternative: Packs Second Alternative: Single units
Revenues $100 per box of 10 units $10 per unit
Variable Costs $60 per box of 10 units $5,5 per unit
Total Fixed costs $2,000 $2,000
a) Contribution margin of Packs and Single Units.
b) Which alternative is better?
c) Calculate the break even point in units for packs and single units
d) Calculate the break even point in dollars for packs and single units
ANS:
a:
b:
c:
d:
Question 1.8.
Given the following comparative data of two projects please answer the following questions.
First alternative: Machine A Second Alternative: Machine B
Revenues $20 per unit $20 per unit
Variable Costs $15 per unit $10 per unit
Total Fixed costs $2,500 $3,000
a) Contribution margin of each alternative: Machine A and Machine B
b) Which alternative is better?
c) Calculate the break even point in units for each alternative: Machine A and Machine B
d) Calculate the break even point in dollars for each alternative: Machine A and Machine B
ANS:
a:
b:
c:
d:
, ADMS 3510 – Past Mid Terms
Question 1.9.
Given the following comparative data of two projects please answer the following questions.
1st alternative: Without Advertisement 2nd Alternative: With Advertisement
Revenues $100 per unit $120 per unit
Variable Costs $40 per unit $40 per unit
Total Fixed costs $6,000 $6,500
a) Contribution margin of each alternative: with and without advertisement
b) Which alternative is better?
c) Calculate the break even point in units for each alternative: with and without advertisement
d) Calculate the break even point in dollars for each alternative: with and without advertisement
ANS:
a:
b:
c:
d:
Unit 1: Management Accounting and the Case Study Method
Question 1.1.
Porter explains that there are five forces that determine industry attractiveness and long-run
industry profitability. Please indicate which ONE of the following is NOT a competitive force:
a) The threat of entry of new competitors (new entrants)
b) The threat of substitutes
c) The bargaining power of suppliers
d) The degree of rivalry between customers
e) The degree of rivalry between existing competitors
ANS: d
Question 1.2.
Indicate which ONE of the following issues is relevant when considering the analysis of new
entrants:
a) Is there overcapacity in our industry?
b) How likely are our customers to switch to competitors’ products or services?
c) How difficult would it be for a new competitor to imitate the way we do business?
d) What supply factors are critical to us: quality, price, reliability, service and so forth?
e) How do we appeal to different segments of the market? Why do they buy our product or
services?
ANS: c
Question 1.3.
Indicate which ONE of the following issues is relevant when considering the analysis of substitute
products or services:
a) How difficult would it be for a new competitor to imitate the way we do business?
b) How likely are our customers to switch to competitors’ products or services?
c) How do we appeal to different segments of the market? Why do they buy our product or
services?
d) Is there overcapacity in our industry?
e) What supply factors are critical to us: quality, price, reliability, service and so forth?
ANS: b
, ADMS 3510 – Past Mid Terms
Question 1.4.
Indicate which ONE of the following issues is relevant when considering the analysis of
customers:
a) What supply factors are critical to us: quality, price, reliability, service and so forth?
b) How likely are our customers to switch to competitors’ products or services?
c) How do we appeal to different segments of the market? Why do they buy our product or
services?
d) Is there overcapacity in our industry?
e) How difficult would it be for a new competitor to imitate the way we do business?
ANS: c
Question 1.5.
Indicate which ONE of the following issues is relevant when considering the analysis of suppliers:
a) What supply factors are critical to us: quality, price, reliability, service and so forth?
b) How likely are our customers to switch to competitors’ products or services?
c) How do we appeal to different segments of the market? Why do they buy our product or
services?
d) Is there overcapacity in our industry?
e) How difficult would it be for a new competitor to imitate the way we do business?
ANS: a
Question 1.6.
Indicate which ONE of the following issues is relevant when considering the analysis of the
competitors in the industry:
a) What supply factors are critical to us: quality, price, reliability, service and so forth?
b) How likely are our customers to switch to competitors’ products or services?
c) How do we appeal to different segments of the market? Why do they buy our product or
services?
d) Is there overcapacity in our industry?
e) How difficult would it be for a new competitor to imitate the way we do business?
ANS: d
, ADMS 3510 – Past Mid Terms
Question 1.7.
Given the following comparative data of two projects please answer the following questions
First alternative: Packs Second Alternative: Single units
Revenues $100 per box of 10 units $10 per unit
Variable Costs $60 per box of 10 units $5,5 per unit
Total Fixed costs $2,000 $2,000
a) Contribution margin of Packs and Single Units.
b) Which alternative is better?
c) Calculate the break even point in units for packs and single units
d) Calculate the break even point in dollars for packs and single units
ANS:
a:
b:
c:
d:
Question 1.8.
Given the following comparative data of two projects please answer the following questions.
First alternative: Machine A Second Alternative: Machine B
Revenues $20 per unit $20 per unit
Variable Costs $15 per unit $10 per unit
Total Fixed costs $2,500 $3,000
a) Contribution margin of each alternative: Machine A and Machine B
b) Which alternative is better?
c) Calculate the break even point in units for each alternative: Machine A and Machine B
d) Calculate the break even point in dollars for each alternative: Machine A and Machine B
ANS:
a:
b:
c:
d:
, ADMS 3510 – Past Mid Terms
Question 1.9.
Given the following comparative data of two projects please answer the following questions.
1st alternative: Without Advertisement 2nd Alternative: With Advertisement
Revenues $100 per unit $120 per unit
Variable Costs $40 per unit $40 per unit
Total Fixed costs $6,000 $6,500
a) Contribution margin of each alternative: with and without advertisement
b) Which alternative is better?
c) Calculate the break even point in units for each alternative: with and without advertisement
d) Calculate the break even point in dollars for each alternative: with and without advertisement
ANS:
a:
b:
c:
d:
