Tag: Management Accounting

The board of directors of Alex plc are currently considering whether to pursue a new strategy in respect of one of their major strategic business units.

When evaluating a strategic option in this way, the final decision on whether to pursue the strategy or not should be judged against which ONE of the following criteria?

Select ONE answer:

1. A cost of entry test
2. An attractiveness test
3. A feasibility test
4. A payoffs test

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct == > Gerry Johnson and Kevan Scholes recommend evaluating strategies against the following criteria: Suitability – does the strategy fit the strengths, objectives and image of the company? Feasibility – does the company have the necessary resources to pursue the strategy effectively? Acceptability – is the strategy acceptable to the company’s
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

The board of directors of Alex plc are currently considering whether to pursue a new strategy in respect of one of their major strategic business units.

When evaluating a strategic option in this way, the final decision on whether to pursue the strategy or not should be judged against which ONE of the following criteria?

Select ONE answer:

1. A cost of entry test
2. A suitability test
3. An attractiveness test
4. A payoffs test

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Notcorrect
2. Correct == > Gerry Johnson and Kevan Scholes recommend evaluating strategies against the following criteria: Suitability – does the strategy fit the strengths, objectives and image of the company? Feasibility – does the company have the necessary resources to pursue the strategy effectively? Acceptability – is the strategy acceptable to the company’s
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

Alex, a product manager with Lucy plc, is currently preparing a report for the company’s directors in which he will provide an assessment of each of the company’s existing product lines.

In preparing his report, Alex is making use of the Boston Consulting Group Matrix.

He has classified one product, the Midlander, as having a low market share in a high growth market.

In the conclusion to his report, therefore, we would expect Alex to recommend that, regarding the Midlander, Lucy plc should pursue the following?

Select ONE answer:

1. Either a hold or a divest strategy
2. Either a hold or a harvest strategy
3. Either a build or a harvest strategy
4. Either a build or a leave strategy

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct == > With a low market share of a high growth market, the Midlander would be classified as a Question Mark within the BCG matrix, for which the possible recommended strategies are Build or Harvest.
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.