Exam 7: Managing Quality and Time to Create Value

Burns Corporation manufactures large kitchen appliances. The following represents financial information for two years: Required: (a) Classify these items into costs of prevention (P), appraisal (A), internal failure(I) or external failure (E) activities. (b) Calculate the ratio of prevention, appraisal, internal failure and external failure costs to sales for 2007 and 2008. (c) Prepare a cost of quality report for 2007.

Which of the following is an external failure activity?

In a just-in-time manufacturing system, a sales order will normally trigger a production order.

Internal failure activities are required to correct defective processes, products, and services that are detected after they have been delivered to customers.

In a statistical control chart, the most likely cause of a run would be:

Lead indicator information usually identifies quality problems and diagnoses their cause(s).

Which of the following statements describes a flowchart?

The optimum quality level maximizes total quality rather than total profits.

A histogram is a chart that shows trends in variation in products or service attributes over time by reflecting measures of important quality features taken at defined points in time.

Performance measurement is classified as an appraisal activity.

Identify the company or companies below that is (are) most likely using a traditional inventory system as opposed to a JIT system.

The optimum quality level is always higher than the maximum quality level.

The Deming Prize:

Connolly Corporation has prepared a control chart of weekly average customer-response times against the historical mean and historical variation. Which of the following is a cause of cyclical behavior?

A control chart describes variation in product or service attributes over time by measuring important quality features and comparing them to maximum and minimum desired levels.

A process can be out of control even if attribute measures do not violate control limits.

Throughput is the amount of goods and services produced and delivered to customers during a period of time measured in dollar terms or physical measures.

Which of the following statements describes a run chart?

Use the following to answer questions: Le Francois Company developed the following information for its first quarter cost of quality report: -The relevant percentage to be used to express appraisal activities at Le Francois is:

The objective of just-in-time (JIT) is to eliminate all defects in products.