Cost managment∶accounting and control 第十二章解答手册.doc

CHAPTER 12activity-based management questions for writing and discussion 1. The two dimensions are the cost dimension and the process dimension. The cost dimension is concerned with accurate assignment of costs to cost objects, such as products and customers. Activity-based costing is the focus of this dimension. The second dimension—the process dimension—provides information about why work is done and how well it is done. It is concerned with cost driver analysis, activity analysis, and performance measurement. This dimension offers the connection to the continuous improvement world found in the advanced manufacturing environment. 2. Driver analysis is concerned with identifying the root causes of activity costs. Knowing the root causes of activity costs is the key to improvement and innovation. Once a manager understands why costs are being incurred, then efforts can be taken to improve cost efficiency. Driver analysis is a part of process value analysis—along with activity analysis and performance measurement. 3 Activity analysis is concerned with identifying activities performed by an organization, assessing their value to the organization, and selecting and keeping only those that are value-added. Selecting and keeping value-added activities bring about cost reduction and greater operating efficiency, thus providing support for the objective of continuous improvement. 4. Value-added activities are necessary activities. Activities are necessary if they are mandated or if they are not mandated and satisfy three conditions: (1) they cause a change of state, (2) the change of state is not achievable by preceding activities, and (3) they enable other activities to be performed. Value-added costs are costs caused by activities that are necessary and efficiently executed. 5. Non-value-added activities are unnecessary activities or necessary activities that are inefficient and improvable. An example is moving goods. Non-value-added costs are those costs caused by no