Exam 8: Setting Process Expectations

Clean and Shiny, LLC, provides window cleaning services to a number of commercial clients. Window-washing crews are given standard times for servicing certain buildings. Given the experience of the crew, these standards can allow more or less time. The Sunshine Crew has recently begun work for Clean and Shiny. Its performance is evaluated using a rolling or moving average standard that reflects the crew's rate of improvement. The table below contains the required time for washing the windows at the home office of the Pony Express National Bank for six months. Required: Using three months as the basis for a lean accounting elapsed time metric, compute the average time the Sunshine Crew requires to complete the Pony Express National Bank job over time. Use the first three months as your baseline, then add one new observation and delete one to produce successive averages.

A product's value proposition will never be affected by non-value-added activities.

Adirondack Designs, Inc., produces wooden furniture in a sequential process involving four departments: cutting, assembly, finishing, and packaging. Labor time available in the finishing department exerts a limiting constraint on the output of the company. According to the Theory of Constraints, process improvements should be confined solely to:

Presario Inc. recently installed just-in-time production and purchasing systems. If Presario's experience is similar to that of other companies, Presario will likely:

Just-in-time management can be applied in a service setting if external benchmarks are available to evaluate the efficiency and capacity of activities.

A company employing just-in-time management principles will maintain a balanced production line.

Like other product costing systems, backflush costing attempts to fully value work-in-process inventories.

A kanban, or small buffer stock, is employed in a cellular flow design to:

Adirondack Designs, Inc., produces wooden furniture in a sequential process involving four departments: cutting, assembly, finishing, and packaging. Labor time available in the finishing department exerts a limiting constraint on the output of the company. According to the Theory of Constraints, the pace of production for the entire system would be set by:

A process is a set of sequential activities that produces a specific output. One of the key attributes of these activities is that they:

One of the key differences between activity-based costing and activity-based management is that the latter takes a forward rather than historical approach.

According to the Theory of Constraints, all of the following activities help to relieve the problem of a bottleneck in operations except:

Activity-based management (ABM) refers to the set of methods intended to control activities so as to:

Traditional forms of budgets and activity-based budgets both emphasize the work that resources accomplish for the company and its stakeholders.

Process management refers to the set of tools and techniques used to manage activities:

Of the following, which best illustrates a non-value-added activity?

A core concept of lean accounting is that the selling prices of a company's products and/or services are a function of:

When a business has entered into the decline phase of its life cycle, activity-based management (ABM) is primarily used to:

Among other products, Bendix Company produces automotive brake pads in its Bowling Green, Ky., factory. In a lean accounting system, which of the following manufacturing costs would Bendix charge to the brake pads produced?

Classic Cars, Inc., produces reproduction parts for older automobiles in a sequential process involving four departments: cutting, shaping, painting and finishing, and packaging. Labor time available in the shaping department exerts a limiting constraint on the output of the company. A principal aim of just-in-time management at Classic Cars would be to balance the flow of work through the four departments so as to: