Module 3 Flashcards

1
Q

A projection of future sales, revenues, earning, costs and other possible variables that are helpful in the firm’s operations

A

Forecasting

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2
Q

Primary objective is to reduce risk or uncertainty that the firm will face in making decisions

A

Forecasting

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3
Q

Starting point of business planning

A

forecasting

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4
Q

who uses forecasting as a tool for decision making?

A

Top management
Production manager
Purchasing manager
Marketing manager
Finance manager
Human resource maganer

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5
Q

Makes use of forecasting as a tool for long-range planning, particularly in providing a basis for performanc targets, etc

A

top management

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6
Q

utilizes forecasts to determine the amount of raw material what will be needed in production

A

production manager

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7
Q

Uses the forecast to ascertain the volum or bulk of material that should be purchase

A

Purchasing manager

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8
Q

Use forecast to estimate how much sales should be maid in a particular period

A

Marketing manager

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9
Q

use forecast to anticipate the funding needed by the firm

A

Finance manager

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10
Q

Use forecast to supply the human resource needed in achiveing the firm objective

A

Human resource manager

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11
Q

Two approaches to forcasting

A

quantitative
Qualitative

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12
Q

incorporate factors such as the decision maker’s intuition, emotion, personal experience, and value system; useful in formulating short term forecast

A

Qualitative (or judgement) forecast

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13
Q

Qualitative forecasting methods

A

Expert opinions
Delphi method
Sales force polling
Consumer market surveys
PERT-derived forecasts (program evaluation and review techniques)

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14
Q

The views of the manager or a group with high level of expertise

A

Expert opinions

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15
Q

similar to expert opinion. But that members of a group of experts are asked individually through a questionnaire

A

Delphi method

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16
Q

every sales person estimates the sales in her region; the responsibility of drawing up the forecast lies with the people

A

sales force polling

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17
Q

Firm, at times, conduct their owm or potential customer surveys to accumulate information regarding future purchasing plans

A

Consumer market surveys

18
Q

A methodolody requires that the expert provide 3 estimates: pessimistic (a), the most likely (m), and optimistic (b)

A

PERT -derived forcasts
Program Evaluatuon and Review Technique

19
Q

Lokking ahead to see what actions should be to realize particular goals

A

Planning

20
Q

looking backward, determining what actually happened and comparing it with the previously planned outcomes

A

control

21
Q

Financial plans for the future and are a key component od planning. They identify objectives and the actions needed to achieve them

A

budgets

22
Q

Plots a direction for an organization’s future activities and operations. It generally covers at least five years

A

Strategic plan

23
Q

Previous year’s budget is irrelevant in allocating resources for the current year

A

Zero base approach

24
Q

starts with previous years budget

A

Incrementak based approach

25
Q

The comprehensive financial plan for the organization as a whole
Typically for one year period
Yearly budgets are broken down into quarterly and monthly budget

A

The master budget

26
Q

A movingb12 month budget
As a month expires in the budget, an additional month in the future is added sonthe company always has a 12 month plam on hand

A

continuous budget

27
Q

Review the budget
Provides policy guidelines and budgetary goals

A

budget committee

28
Q

Usually the controller, is the pedson responsible for directing and coordinating the organization’s overall budgeting process

A

Budget director

29
Q

The maater budget major components

A

operating budgets
Financial budgets

30
Q

Describe the income generating activities

A

operating budget

31
Q

Details the inflows and outflows of cash and the overall financial position

A

financial budget

32
Q

Approved by the budget committee and describes expexted sales in units and pesos
The basis for all of the other operating budgets and most of the financial budget

A

sales budget

33
Q

tells how many units must be produced to meet sales needs and to sarisfy endinf inventory requirements

A

production budget

34
Q

tells the amount and cost of raw materials to be purchased

A

Direct materials purchases budget

35
Q

Shows the total direct labor hours and the direct labor cost needed for the number of units in the production budget

A

Direct labour budget

36
Q

use a variety of mathematical models that rely on hiatorical data and/or causal variables to forecast demand

A

quantitative forecast

37
Q

Assumes that the future is a funtion of the past. Thus, historical data are used to predict the future using sequences with equal period

A

time series forecasting

38
Q

the gradual upward or downwaed movement of the data over time

A

trend

39
Q

data pattern that repeats itself after a period of days

A

Seasonality

40
Q

a pattern of data that occurs every several years

A

Cycle

41
Q

blips in the data by chance and unusual situations

A

Random variations

42
Q

Such as linear regession, incorporate the variables or factors that might influence the quantity beinh forecast

A

Associative or casual models