Q&A Hero

Q: Which of the following is not one of the perspectives evaluated in the balanced scorecard approach? a. customers b. internal business processes c. learning and growth d. financial e. all of the above are perspectives in the balanced scorecard approach

Q: The balanced scorecard approach is based on the belief that management should evaluate their business from ____ distinct perspectives. a. two b. three c. four d. five

Q: With respect to asset turnover, ____ is typically the most relevant logistics asset. a. warehousing b. inventory c. transportation equipment d. materials handling equipment

Q: What is the formula for asset turnover? a. total sales divided by total assets b. net profit divided by total assets c. return on assets divided by total assets d. return on investment divided by return on net worth

Q: With respect to net profit margin, the most relevant categories for logistics managers to consider are: a. sales, costs of goods sold, asset turnover b. accounts receivable, costs of goods sold, total expenses c. sales, costs of goods sold, total expenses d. inventory, accounts receivable, total expenses

Q: What is the formula for net profit margin? a. gross profit minus interest expenses b. sales divided by costs of goods sold c. total sales divided by total assets d. net profit divided by sales e. none of the above

Q: Which of the following is false? a. the Strategic Profit Model (SPM) can assist the logistics manager in the evaluation of cash flows and asset utilization decisions b. the SPM fails to consider the timing of cash flows c. the SPM is subject to manipulation in the short run d. the SPM fails to recognize assets that are dedicated to specific relationships e. all of the above are true

Q: Suppose that a logistics manager is able to eliminate some unnecessary inventory, which reduces the value of current assets as well as total asset value. What is the corresponding impact on inventory turnover and return on assets? a. both inventory turnover and return on assets will increase b. inventory turnover increases, while return on assets decreases c. inventory turnover decreases, while return on assets increases d. both inventory turnover and return on assets will decrease

Q: Return on assets equals: a. current assets divided by total assets b. return on investment divided by return on net worth c. net profit margin times asset turnover d. total assets divided by costs of goods sold

Q: What provides the framework for conducting return on assets analysis by incorporating revenues and expenses to generate net profit margin, as well as inclusion of assets to measure asset turnover? a. the Balanced Scorecard b. the Strategic Profit Model c. microfinancing d. Supply Chain Operations Reference Model

Q: Which of the following is a common measure of organizational financial success? a. quick ratio b. the income statement c. current ratio d. return on investment

Q: The current ratio is calculated by dividing ____ by ____. a. total current assets; total current liabilities b. total current liabilities; total current assets c. total assets; total liabilities d. total liabilities; total assets

Q: Which of the following does not appear on the balance sheet? a. assets b. owners' equity c. liabilities d. net income e. all of the above appear on the balance sheet

Q: The balance sheet reflects the assets, liabilities, and____ at a given point in time. a. costs of goods sold b. net income c. owners' equity d. asset turnover

Q: The ____ reflects the assets, liabilities, and owners' equity at a given point in time. a. balanced scorecard b. balance sheet c. income statement d. annual report

Q: In general, the ____ measures the profitability of the products and/or services provided by a company. a. balance sheet b. strategic profit model c. balanced scorecard d. income statement

Q: The ____ shows revenues, expenses, and profit for a period of time. a. balance sheet b. current ratio c. income statement d. annual report

Q: When developing logistics strategy, a ____ strategy refers to the management of logistics activities with a focus on costs. a. market b. process c. command and control d. information

Q: Which of the following is not a potential type of logistics strategy decisions? a. investments in technology that support logistics activities b. selecting appropriate transportation modes c. deployment of inventory d. number and location of warehouses e. all of the above are potential logistics strategy decisions

Q: ____ strategy decisions involve issues such as the number and location of warehouses and the selection of appropriate transportation modes. a. marketing b. production c. finance d. logistics

Q: Which of the following represents the preferred hierarchy of strategy (i.e., from the first strategy to be developed to the last to be developed)?a. corporate->business unit->functionalb. functional->business unit->corporatec. corporate->business unit->divisionald. business unit->divisional->functional

Q: A(n) ____ entails the functional units of an organization providing input into the other levels of strategy formulation. a. supply chain b. interfunctional cooperation c. hierarchy of strategy d. enterprise resource system

Q: Which generic strategy concentrates an organization's effort on a narrowly defined market to achieve either a cost leadership or differentiation strategy? a. hybrid b. market orientation c. tailored d. focus

Q: A ____ strategy entails an organization developing a product and/or service that offers unique attributes that are valued by customers and that the customer perceives to be distinct from competitor offerings. a. focus b. differentiation c. value enhancement d. market orientation

Q: Which of the following is not one of the generic strategies that can be pursued by an organization, as identified by strategist Michael Porter? a. value enhancement b. differentiation c. cost leadership d. focus e. all of the above are generic strategies

Q: Strategy at a ____ level is primarily focused on the products and services provided to customers and on finding ways to develop and maintain a sustainable competitive advantage with these customers. a. functional b. business unit c. divisional d. corporate

Q: ____ strategy is focused on determining the goals for the company, the types of businesses in which the company should compete, and the way the company will be managed. a. functional-level b. business unit-level c. divisional-level d. corporate-level

Q: Which of the following is not a level at which strategy can be formulated? a. corporate b. business unit c. functional d. all of the above are levels at which strategy can be formulated

Q: Depending on industry and product type, reverse logistics costs as a percent of revenue can range between ____ and ____ percent. a. 5; 10 b. 4; 8 c. 3; 6 d. 2; 4

Q: Discuss some of the key considerations for a logistics manager who is designing and implementing a logistics measurement system in their organization.

Q: Do you agree or disagree with the sentiment that logistics measurement systems need to include both financial and nonfinancial measures? Why?

Q: What are the major parts of a balanced scorecard? Why are these parts needed?

Q: Discuss the common types of information included in traditional logistics measurement systems.

Q: Discuss how logistics decisions might affect an organization's cost of goods sold.

Q: Why might performance measurement be more difficult in global logistics systems?

Q: Do you think corporate cultures are relevant for designing a logistics measurement system? Why or why not?

Q: What are some common logistics measures in transportation, warehousing, and inventory management?

Q: Most managers believe that while it is possible to connect logistics decisions to costs, the connection to revenue enhancement is difficult to impossible. Do you agree or disagree? Why?

Q: Why is top management commitment necessary for establishing a successful logistics performance measurement system?

Q: How does logistics strategy connect to overall corporate strategy? Is it a one-way or two-way connection?

Q: Do you agree or disagree that return on assets is a good way to examine operational efficiency? Why?

Q: Discuss some of the ways that inventory costs can be reduced in order to affect an organization's financial performance.

Q: Discuss how logistics decisions affect asset turnover in an organization.

Q: Discuss how logistics decisions affect net profit margin in an organization.

Q: What are the key components of the Strategic Profit Model? How can it be used to examine the effect of logistics decisions?

Q: What are the three key components of a balance sheet?

Q: What are the two key components of an income statement?

Q: Discuss the cost leadership, differentiation advantage, and focus strategies.

Q: Discuss the differences between corporate-level, business-unit level, and functional-level strategies.

Q: Holding all other information constant, what would be the effect on ROA for 2012 if warehousing costs declined 10 percent from 2012 levels?

Q: Use the 2012 income statement and balance sheet to complete a Strategic Profit Model for J.Q.

Q: When comparing 2012 figures with the 2013 figures shown in the table, the amount budgeted for each warehouse in 2013 was greater than actual 2012 costs. How much of the increase is caused by increased volume of business (units shipped) and how much by inflation?

Q: The year 2013 is nearly half over. J.Q. is told to determine how much the firm is likely to spend for warehousing at each of the eight warehouses for the last six months of 2013. Do his work for him.

Q: J.Q. is aggressive and is going to recommend that his father cancel the contract with one of the warehouses and give that business to a competing warehouse in the same city. J.Q. feels that when word of this gets around, the other warehouses they use will "shape up." Which of the seven should J.Q. recommend be dropped? Why?

Q: When comparisons are made among all eight warehouses, which one do you think does the best job for the Brant Company? What criteria did you use? Why?

Q: When comparing performance during the first five months of 2013 with performance in 2012, which warehouse shows the poorest change in performance?

Q: When comparing performance during the first five months of 2013 with performance in 2012, which warehouse shows the most improvement?

Q: When applying performance measures to logistics activities, determination of the key measures should be tailored to the individual organization and level of decision making.

Q: The cash-to-cash cycle looks at how long an organization's cash is tied up in receivables, payables, and inventory.

Q: Best in Class companies tend to use transportation scorecards less frequently than other companies.

Q: The measures associated with the balanced scorecard can be at a strategic or tactical level.

Q: According to the balanced scorecard approach, the financial perspective is considered the best indicator of whether or not logistics strategy is being properly implemented and executed.

Q: The balanced scorecard is based on the belief that management should evaluate their business from five different perspectives.

Q: A decision to invest in an electronic data interchange system that would increase invoice accuracy should result in a lower amount of accounts receivable.

Q: With respect to asset turnover, inventory is typically the most relevant logistics asset.

Q: Asset turnover is computed by dividing return on assets by total assets.

Q: The primary influence of logistics activities on sales would be through the improvement of customer service.

Q: With respect to net profit margin, the most relevant categories for logistics managers to consider are sales, costs of goods sold, and asset turnover.

Q: Operationally, net profit margin is net profit divided by cost of goods sold.

Q: A reduction in inventory would increase inventory turnover, which means an increase in that organization's return on assets (ROA).

Q: The balanced scorecard provides the framework for conducting return on assets analysis by incorporating revenues and expenses to generate net profit margin, as well as inclusion of assets to measure asset turnover.

Q: Return on assets equals net profit margin times asset turnover.

Q: A common measure of organizational financial success is return on investment.

Q: The current ratio is calculated by dividing total current liabilities by total current assets.

Q: Owners' equity is the difference between what a company owns and what it owes at any particular point in time.

Q: Long-term assets have a useful life of more than two years.

Q: The balance sheet reflects the assets, liabilities, and costs of goods sold at a given point in time.

Q: Superior logistics service can have a positive influence on an organization's financial performance.

Q: In general, the income statement measures the profitability of the products and/or service provided by a company.

Q: The income statement is the same thing as the balance sheet.