The Golden Wheels Trailer Company recorded the following information for two of their trailers: $\begin{array}{lcc}&\text { Trailer A } &\text { Trailer B }\\ \text { Processing time } & 3 \text { hours } & 5 \text { hours } \\ \text { Vinyl cover used } & 17 \text { sq. ft. } & 13 \mathrm{sq} . \mathrm{ft} \\ \text { Selling price } & \$ 60.00 & \$ 90.00 \\ \text { Variable cost } & \$ 45.00 & \$ 60.00 \\ \text { Fixed cost } & \$ 20.00 & \$ 30.00 \end{array}$ There are 100 hours available in the plant and 75 square feet of vinyl available per operating period. What is the objective function for maximizing profits?

A) Minimize $15A + $30B B) Maximize $60A + $90B C) Maximize $45A + $60B D) Maximize $15A + $30B A) Minimize $15A + $30B B) Maximize $60A + $90B C) Maximize $45A + $60B D) Maximize $15A + $30B

The Golden Wheels Trailer Company recorded the following information for two of their trailers: $\begin{array}{lcc}&\text { Trailer A } &\text { Trailer B }\\ \text { Processing time } & 3 \text { hours } & 5 \text { hours } \\ \text { Vinyl cover used } & 17 \text { sq. ft. } & 13 \mathrm{sq} . \mathrm{ft} \\ \text { Selling price } & \$ 60.00 & \$ 90.00 \\ \text { Variable cost } & \$ 45.00 & \$ 60.00 \\ \text { Fixed cost } & \$ 20.00 & \$ 30.00 \end{array}$ There are 100 hours available in the plant and 75 square feet of vinyl available per operating period. The constraint equation representing the materials available for the production processes is

A) 3A + 5B ? 100. B) 17A + 13B = 75. C) 17A + 13B ? 75. D) 3A + 5B = 200. A) 3A + 5B ? 100. B) 17A + 13B = 75. C) 17A + 13B ? 75. D) 3A + 5B = 200.

The following information is available for Woodside Furniture Company, which sells two products: $\begin{array}{lcc}&\text { Chair X } & \text { Chair Y }\\ \text { Processingtime } & 4 \text { hours } & 6 \text { hours } \\ \text { Metal used } & 30 \text { sq. ft. } & 18 \text { sq. ft. } \\ \text { Selling price } & \$ 200.00 & \$ 100.00 \\ \text { Variable cost } & \$ 150.00 & \$ 60.00 \\ \text { Fixed cost } & \$ 30.00 & \$ 30.00 \end{array}$ There are 200 hours available in the plant and 200 square feet of metal available per operating period. What is the objective function for maximizing sales?

A) Minimize 200X + 100Y B) Maximize 180X + 90Y C) Maximize 50X + 40Y D) Maximize 200X + 100Y A) Minimize 200X + 100Y B) Maximize 180X + 90Y C) Maximize 50X + 40Y D) Maximize 200X + 100Y

The Golden Wheels Trailer Company recorded the following information for two of their trailers: $\begin{array}{lcc}&\text { Trailer A } &\text { Trailer B }\\ \text { Processing time } & 3 \text { hours } & 5 \text { hours } \\ \text { Vinyl cover used } & 17 \text { sq. ft. } & 13 \mathrm{sq} . \mathrm{ft} \\ \text { Selling price } & \$ 60.00 & \$ 90.00 \\ \text { Variable cost } & \$ 45.00 & \$ 60.00 \\ \text { Fixed cost } & \$ 20.00 & \$ 30.00 \end{array}$ There are 100 hours available in the plant and 75 square feet of vinyl available per operating period. Which of the following statements is INCORRECT?

A) The materials constraint favors Trailer B over Trailer A. B) The time constraint favors Trailer A over Trailer B. C) The objective function favors Trailer B over Trailer A. D) The material constraint favors Trailer A over Trailer B. A) The materials constraint favors Trailer B over Trailer A. B) The time constraint favors Trailer A over Trailer B. C) The objective function favors Trailer B over Trailer A. D) The material constraint favors Trailer A over Trailer B.

A) the cost of holding inventory. B) a non-value activity and should never be considered. C) not considered when calculating the reorder point. D) extra inventory carried to serve as insurance against fluctuations in demand. A) the cost of holding inventory. B) a non-value activity and should never be considered. C) not considered when calculating the reorder point. D) extra inventory carried to serve as insurance against fluctuations in demand.

Albuquerque Company has the following information available concerning one of its inventory items: \[\begin{array} { l r } \text { Cost of placing an or der } & \$ 50.00 \\ \text { Unit carrying cost per year } & \$ 2.00 \\ \text { Annual unit demand } & 3,200 \\ \text { Safety stock } & 80 \\ \text { Average daily demand } & 10 \\ \text { Normal lead time in days } & 12 \end{array}\] The reorder point for the inventory item is

A) 500 units. B) 970 units. C) 320 units. D) 200 units. A) 500 units. B) 970 units. C) 320 units. D) 200 units.

Exam 20: Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

When only one binding constraint exists, the product with the smallest contribution margin will be focused on.

(True/False)

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Question 21

The Golden Wheels Trailer Company recorded the following information for two of their trailers: Trailer A Trailer B Processing time 3 hours 5 hours Vinyl cover used 17 sq. ft. 13. Selling price \ 60.00 \ 90.00 Variable cost \ 45.00 \ 60.00 Fixed cost \ 20.00 \ 30.00 There are 100 hours available in the plant and 75 square feet of vinyl available per operating period. What is the objective function for maximizing profits?

(Multiple Choice)

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Question 22

External constraints are imposed on a firm from within and internal constraints are imposed electronically.

(True/False)

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Question 23

Which of the following costs are considered in the EOQ model?

(Multiple Choice)

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Question 24

The Golden Wheels Trailer Company recorded the following information for two of their trailers: Trailer A Trailer B Processing time 3 hours 5 hours Vinyl cover used 17 sq. ft. 13. Selling price \ 60.00 \ 90.00 Variable cost \ 45.00 \ 60.00 Fixed cost \ 20.00 \ 30.00 There are 100 hours available in the plant and 75 square feet of vinyl available per operating period. The constraint equation representing the materials available for the production processes is

(Multiple Choice)

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Question 25

The following information is available for Woodside Furniture Company, which sells two products: Chair X Chair Y Processingtime 4 hours 6 hours Metal used 30 sq. ft. 18 sq. ft. Selling price \ 200.00 \ 100.00 Variable cost \ 150.00 \ 60.00 Fixed cost \ 30.00 \ 30.00 There are 200 hours available in the plant and 200 square feet of metal available per operating period. What is the objective function for maximizing sales?

(Multiple Choice)

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Question 26

Which of the following systems is used to ensure that parts or materials are available when needed for production?

(Multiple Choice)

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Question 27

A withdrawal Kanban specifies

(Multiple Choice)

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Question 28

The JIT approach to inventory management

(Multiple Choice)

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Question 29

The model which expresses a constrained optimization problem as a linear objective function is called the __________ model.

(Short Answer)

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Question 30

The cost of holding inventory is known as

(Multiple Choice)

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Question 31

The __________ is the amount of inventory needed to keep the constrained resource busy for a specified time interval.

(Short Answer)

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Question 32

Crimson Wheels Bus Company produces buses. In order to produce the seats for the buses, special equipment must be set up. The setup cost per frame is $20. The cost of carrying seats in inventory is $5 per seat per year. The company produces 125,000 buses per year. The number of seats that should be produced per setup in order to minimize the total setup and carrying costs is:

(Multiple Choice)

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Question 33

A marker or card that signals to a supplier the quantity of materials that need to be delivered and the time of delivery is a

(Multiple Choice)

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Question 34

The Golden Wheels Trailer Company recorded the following information for two of their trailers: Trailer A Trailer B Processing time 3 hours 5 hours Vinyl cover used 17 sq. ft. 13. Selling price \ 60.00 \ 90.00 Variable cost \ 45.00 \ 60.00 Fixed cost \ 20.00 \ 30.00 There are 100 hours available in the plant and 75 square feet of vinyl available per operating period. Which of the following statements is INCORRECT?

(Multiple Choice)

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Question 35

Safety stock is

(Multiple Choice)

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Question 36

In the economic order quantity equation, the numerator under the square root includes

(Multiple Choice)

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Question 37

Which of the following is NOT a cost readily identified with inventory management?

(Multiple Choice)

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Question 38

The manufacturing model which shares the same practices as a JIT manufacturing system is called __________ manufacturing.

(Short Answer)

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Question 39

Albuquerque Company has the following information available concerning one of its inventory items: Cost of placing an or der \ 50.00 Unit carrying cost per year \ 2.00 Annual unit demand 3,200 Safety stock 80 Average daily demand 10 Normal lead time in days 12 The reorder point for the inventory item is

(Multiple Choice)

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Question 40

When only one binding constraint exists, the product with the smallest contribution margin will be focused on.

External constraints are imposed on a firm from within and internal constraints are imposed electronically.

Which of the following costs are considered in the EOQ model?

Which of the following systems is used to ensure that parts or materials are available when needed for production?

A withdrawal Kanban specifies

The JIT approach to inventory management

The model which expresses a constrained optimization problem as a linear objective function is called the __________ model.

The cost of holding inventory is known as

The __________ is the amount of inventory needed to keep the constrained resource busy for a specified time interval.

A marker or card that signals to a supplier the quantity of materials that need to be delivered and the time of delivery is a

Safety stock is

In the economic order quantity equation, the numerator under the square root includes

Which of the following is NOT a cost readily identified with inventory management?

The manufacturing model which shares the same practices as a JIT manufacturing system is called __________ manufacturing.

Introduction to Cost Management

Basic Cost Management Concepts

Cost Behavior

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

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