ADMS 3930 Lecture Notes - Lecture 6: Delphi Method, Satisficing, Production Blocking
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13 Feb 2017
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Inco has invested in the voisey bay project at the beginning. Further investment in the project could be 5 to 10 times the amount of the first investment. The risk is high, but potential payoff could be significant. A problem is a gap between a desired state and an existing state. To make decisions to solve problems, managers must: Have the knowledge, skills, abilities, and resources to fix the problem. Decision criteria are standards used to guide judgments and decisions. Generally, the more criteria a solution meets, the better that solution will be. Each criterion is compared to a standard or ranked on its own merits. Each criterion is compared directly to every other criterion. Absolute weighting of decision criteria for a car purchase. Criteria used to evaluate best company locations. Managers try to take a rational approach to decision-making. Rationality assumes decision-making under a condition of certainty. Complete information and knowledge of all possible outcomes.
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FILL IN THE CORRECT TERMINOLOGIES IN THE BLANK SPACES | ||
_____ 1. | a. A method of internal (managerial accounting) reporting that emphasizes the distinction between variable and fixed costs. | |
_____ 2. | b. A discounted cash flow approach to capital budgeting that computes the present value of all future cash flows. | |
_____ 3. | c. Determination of the maximum cost a company can spend to make a product given a set volume, selling price and desired operating profit. | |
_____ 4. | d. An analysis of the additional costs and benefits of a proposed alternative compared with the current situation. | |
_____ 5. | e. A historical cost that the company has already incurred which is irrelevant to the decision making process. | |
_____ 6. | f. Costs that will not continue if an ongoing operation is changed or deleted. | |
_____ 7. | g. An already owned production site that is not currently in use. | |
_____ 8. | h. The maximum available benefit foregone by using a resource for a particular purpose. | |
_____ 9. | i. The predicted future costs and revenues that will differ among alternative courses of action. | |
_____ 10. | J. The time it will take to recoup, in the form of cash inflows from operations, the initial dollars invested in a project | |
_____ 11. | k. Those costs of facilities and services that are shared by users | |
_____ 12. | l. The juncture of manufacturing where separate products developed in the same process become individually identifiable. | |
_____ 13. | m. A costing approach that considers all indirect manufacturing costs (both variable and fixed) to be product (inventoriable) costs. | |
_____ 14. | n. Purchasing products or services from a supplier outside the company. | |
_____ 15. | o. Capital budgeting models that focus on cash inflows and ouflows while taking into account the time value of money | |
_____ 16. | p. Calculation of a selling price sufficient to cover the cost of producing a product as well as desired operating income | |
_____ 17 | q. The long-term planning for investment commitments with returns spread over multiple years | |
_____ 18. | r. A decision process that compares the differential revenues and costs of alternatives. | |
_____ 19. | s. Costs that will continue even if a company discontinues one of its current operations | |
_____ 20. | t. The increase in expected average annual operating income divided by the original required investment |