chpt 5 faq

chpt 5 faq - FAQs - Chapter 5 1. Where in the Cost Life...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
FAQs - Chapter 5 1. Where in the Cost Life Cycle can Target Costing and the Theory of Constraints be most valuable? Target costing can be most effective in reducing costs in the design phase of the cycle, while the Theory of Constraints is most effective in reducing costs in the production, marketing, and distribution phases. 2. What is the drum-buffer-rope (DBR) system, and how can it help manage the flow of production? The DBR system balances the flow of production through a binding constraint, which reduces the amount of inventory at the constraint and improves overall productivity. 3. What is concurrent engineering and how can it be an effective strategy for product design? Concurrent engineering is a method of product design where design is integrated with manufacturing and marketing throughout the product’s life cycle. This integration leads to a better flow of information between the processes of a product, which in turn can mean a reduction in total product costs. 4. For what types of firms is target costing most appropriate and why? Target costing is most appropriate for firms that are in a very competitive industry, so that the firms in the industry compete simultaneously on price, quality and product functionality. In very competitive markets such as this, target costing is used to determine the desired level of functionality the firm can offer for the product while maintaining high
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 10/26/2010 for the course MBA FIN301 taught by Professor Park during the Spring '10 term at Liberty.

Page1 / 3

chpt 5 faq - FAQs - Chapter 5 1. Where in the Cost Life...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online