Page 16 - MCS August Day 1 Tasks
P. 16
Chapter 4
ADVANCED MANAGEMENT
ACCOUNTING (P2) FAMILIARISATION
1. TOTAL QUALITY MANAGEMENT AND COSTS OF QUALITY
Montel’s strategy relies on high quality products being produced.
EXERCISE 1:
Explain the principles underlying the concept of total quality management (TQM). Discuss the
four costs of quality and give examples of each for Montel.
2. LEARNING CURVES
EXERCISE 2:
Explain what learning curves are and where they may exist for Montel. Discuss the criteria that
lead to the existence of a learning curve and the consequences for the business of a learning
curve existing.
3. TARGET COSTING
EXERCISE 3:
Explain the concept of target costing and discuss how target costing would be useful for Montel if
it was forced to reduce the price of one of its models to maintain market share. Include a
discussion of cost‐reduction methods within your answer.
KAPLAN PUBLISHING 9
