Customer profitability analysis allows managers to do which of the following: a. Identify the closest competitor. b. Focus solely on service calls. c. Sell to higher end customers. d. Manage each customers costs-to-serve.

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter11: Strategic Cost Management
Section: Chapter Questions
Problem 11E: Assign the customer-related activity costs to each customer type using activity rates. Now calculate...
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1. Customer profitability analysis allows managers to do which of the following:
a. Identify the closest competitor.
b. Focus solely on service calls.
c. Sell to higher end customers.
d. Manage each customers costs-to-serve.

2. Transferred-in units and cost flows are similar to:
a. Materials added at the end of the process.
b. Materials added at the beginning of the process.
c. Conversion costs added at the end of the process.
d. Conversion costs added at the beginning of the process.
3. In making decisions about whether to sell at split-off or process joint     products further, the allocation
 of joint manufacturing costs is treated as a(n):
a. Essential cost
b. Weighted average cost
c. Sunk cost
d. Period cost

4. Cost allocation provides a service firm a basis for evaluating the:
a. Cost and profitability of its services.
b. Value of its services.
c. Manufacturing costs for the company.
d. The exact cost of each department

5. Customer lifetime value is concerned with which of the following:
a. Customer loyalty.
b. Customer wealth.
c. Customer long-term value.
d. Customer short-term profitability.

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