Question 1

Which of the following results in fewer transactions in lean accounting?

Accepted Answer

A)  all manufacturing costs are combined in one account called Raw and In Process Inventory. 
B)  the distinction between direct and indirect costs is eliminated. 
C)  there is less movement of inventory between departments. 
D)  All of the above. 
A)  all manufacturing costs are combined in one account called Raw and In Process Inventory. 
B)  the distinction between direct and indirect costs is eliminated. 
C)  there is less movement of inventory between departments. 
D)  All of the above.

Question 2

Which of the following is characteristic of the traditional cost system?

Accepted Answer

A)  Many work in process account transactions. 
B)  Reliance on financial performance measures. 
C)  Many process control points. 
D)  All of the above. 
A)  Many work in process account transactions. 
B)  Reliance on financial performance measures. 
C)  Many process control points. 
D)  All of the above.

Question 3

It is easier to quantify costs of controlling quality than the costs of failing to control quality.

Accepted Answer

A) True 
 B)False

Question 4

A college would like to increase enrollment by streamlining the enrollment process. Which of the following would not fall in line with the college goal?

Accepted Answer

A)  Reduce the requirements necessary to enroll. 
B)  Relocate counselors, academic advisors, and financial aid specialists for a major to a central location. 
C)  Cross-train counselors, academic advisors, and financial aid specialists. 
D)  All of these choices would fall in line with the college goal. 
A)  Reduce the requirements necessary to enroll. 
B)  Relocate counselors, academic advisors, and financial aid specialists for a major to a central location. 
C)  Cross-train counselors, academic advisors, and financial aid specialists. 
D)  All of these choices would fall in line with the college goal.

Question 5

In a lean system, the work in process and raw materials inventory accounts are combined.

Accepted Answer

A) True 
 B)False

Question 6

Identity the following by their type of quality cost.
-Returned merchandise

Accepted Answer

A) Preventive costs 
B) Appraisal costs 
C) Internal failure costs 
D) External failure costs 
A) Preventive costs 
B) Appraisal costs 
C) Internal failure costs 
D) External failure costs

Question 7

Large batch sizes increase lead time.

Accepted Answer

A) True 
 B)False

Question 8

Lead time is the process time between start and completion.

Accepted Answer

A) True 
 B)False

Question 9

In a lean system, direct labor is included in conversion costs.

Accepted Answer

A) True 
 B)False

Question 10

Identity the following by their type of quality cost.
-Preventive machine maintenance

Accepted Answer

A) Preventive costs 
B) Appraisal costs 
C) Internal failure costs 
D) External failure costs 
A) Preventive costs 
B) Appraisal costs 
C) Internal failure costs 
D) External failure costs

Question 11

Identity the following by their type of quality cost.
-Testing

Accepted Answer

A) Preventive costs 
B) Appraisal costs 
C) Internal failure costs 
D) External failure costs 
A) Preventive costs 
B) Appraisal costs 
C) Internal failure costs 
D) External failure costs

Question 12

manufacturing philosophy emphasizes quality and zero defects.

Accepted Answer

A)  Traditional 
B)  Lean 
C)  Zero-Based 
D)  Chinese 
A)  Traditional 
B)  Lean 
C)  Zero-Based 
D)  Chinese

Question 13

Make-to-order companies produce mainly to stock inventory.

Accepted Answer

A) True 
 B)False

Question 14

In a lean system, there are fewer transactions to record than there are in a traditional system.

Accepted Answer

A) True 
 B)False

Question 15

The lean philosophy views inventory as a necessary buffer to protect against process problems.

Accepted Answer

A) True 
 B)False

Question 16

A nonfinancial measure is operating information that has not been translated into dollars.

Accepted Answer

A) True 
 B)False

Question 17

From the foregoing information, determine the manufacturing cost per unit.

Accepted Answer

A)  $240.00 
B)  $268.00 
C)  $296.00 
D)  $1,870.50 
A)  $240.00 
B)  $268.00 
C)  $296.00 
D)  $1,870.50

Question 18

Schedule of Activity Costs $\begin{array}{|l|l|}
\hline \text { Quality Control Activities } & \text { Activity Cost } \
\hline \text { Product testing } & \$ 55,000 \
\hline \text { Assessing vendor quality } & 26,000 \
\hline \text { Recalls } & 18,000 \
\hline \text { Rework } & 29,000 \
\hline \text { Scrap disposal } & 8,000 \
\hline \text { Product design } & 30,000 \
\hline \text { Training machine operators } & 46,000 \
\hline \text { Warranty work } & 12,000 \
\hline \text { Process audits } & 22,000 \
\hline
\end{array}$
-From the above schedule, calculate the a) prevention and b) appraisal costs.

Accepted Answer

a) $102,000 = $26,00

Question 19

Within-batch wait time increases total lead time.

Accepted Answer

A) True 
 B)False

Question 20

One inherent risk to using lean philosophy is that companies are at higher risk of inventory shortage during volatile times such as strikes, weather, etc. than when using the traditional philosophy.

Accepted Answer

A) True 
 B)False

Exam 27: Lean Principles, Lean Accounting, and Activity Analysis

Which of the following results in fewer transactions in lean accounting?

Which of the following is characteristic of the traditional cost system?

It is easier to quantify costs of controlling quality than the costs of failing to control quality.

A college would like to increase enrollment by streamlining the enrollment process. Which of the following would not fall in line with the college goal?

In a lean system, the work in process and raw materials inventory accounts are combined.

Identity the following by their type of quality cost. -Returned merchandise

Large batch sizes increase lead time.

Lead time is the process time between start and completion.

In a lean system, direct labor is included in conversion costs.

Identity the following by their type of quality cost. -Preventive machine maintenance

Identity the following by their type of quality cost. -Testing

manufacturing philosophy emphasizes quality and zero defects.

Make-to-order companies produce mainly to stock inventory.

In a lean system, there are fewer transactions to record than there are in a traditional system.

The lean philosophy views inventory as a necessary buffer to protect against process problems.

A nonfinancial measure is operating information that has not been translated into dollars.

From the foregoing information, determine the manufacturing cost per unit.

Within-batch wait time increases total lead time.

One inherent risk to using lean philosophy is that companies are at higher risk of inventory shortage during volatile times such as strikes, weather, etc. than when using the traditional philosophy.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis, Product Pricing, and Activity-Based Costing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Filters