Exam (elaborations)
Comp XM – Questions With Detailed Solutions
Comp XM – Questions With Detailed Solutions
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Comp XM – Questions With Detailed SolutionsA productivity index of 110% means that a company's labor costs would
have been 10% higher if it had not made production improvements. Now
refer to the Income Statement in Digby's Annual Report. The direct labor
costs for Digby were $32,486. These labor costs could have been $20,000
higher if investments in training that increased productivity had not been
made. What was the productivity index for Digby that led to such savings?
✔️Ans -161.6%
Investing $1,500,000 in TQM's Channel Support Systems initiative will at a
minimum increase demand for your products 1.7% in this and in all future
rounds. (Refer to the TQM Initiative worksheet in the CompXM Decisions
menu.) Looking at the Round 0 Inquirer for Andrews, last year's sales were
$163,189,230. Assuming similar sales next year, the 1.7% increase in
demand will provide $2,774,217 of additional revenue. With the overall
contribution margin of 34.1%, after direct costs this revenue will add
$946,008 to the bottom line. For simplicity, assume that the demand
increase and margins will remain at last year's levels. How long will it take
to achieve payback on the initial $1,500,000 TQM investment, rounded to
the nearest month? ✔️Ans -9 months
Bam's product manager is under pressure to increase market share, but is
uncertain about how to make the product more competitive. The product is
reasonably well-positioned in the Thrift segment and enjoys relatively high
awareness and accessibility. Which of the following would most likely
result in a quick increase in market share? ✔️Ans -Lower the unit selling
price to the bottom limit of the segment price range
Looking forward to next year, if Baldwins current cash amount is $20,132
(000) and cash flows from operations next period are unchanged from this
period and Baldwin takes ONLY the following actions relating to cash flows
from investing and financing activities:
Issues $2,000 (000) of long-term debt
Pays $4,000 (000) in dividends
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