Question 1

Kaizen costing requires relevant financial results to be shared with front-line employees.

Accepted Answer

A) True 
 B)False  True

Question 2

Vander Belt Manufacturing, Inc., is considering reorganizing its plant into manufacturing cells. The following estimates have been prepared to evaluate the benefits from the reorganization:
 
Inventory carrying costs are estimated to be 11%  per year.
-As a result of the layout reorganization,incremental manufacturing costs are projected to:

Accepted Answer

A) decrease by $11,400 annually. 
B) decrease by $12,500 annually. 
C) increase by $12,500 annually. 
D) increase by $20,000 annually. 
A) decrease by $11,400 annually. 
B) decrease by $12,500 annually. 
C) increase by $12,500 annually. 
D) increase by $20,000 annually. C

Question 3

A motorcycle manufacturer is currently using a conventional processing system.Recently work-in-process inventory has been piling up at two stations along the assembly line.To eliminate this problem,management discussed the possibility of implementing just-in-time manufacturing.Discuss the advantages and concerns of implementing JIT.

Accepted Answer

The advantages of implementing just-in-time manufacturing include fewer work-in-process inventories, which generally result in reduced cycle time, improved product quality, and reduced material waste and rework costs, increased sales, and decreased carrying cost-of-work-in-process inventories.
Concerns include establishing and maintaining good relations with reliable suppliers and the structural and cultural change in the work environment.

Question 4

Characteristics of cellular manufacturing include:

Accepted Answer

A) a layout that is usually circular like a cell. 
B) increasing the number of employees needed to produce a product. 
C) individual areas for employees so each can work independently without interruption. 
D) a flexible layout that can be easily adjusted to make a different product. 
A) a layout that is usually circular like a cell. 
B) increasing the number of employees needed to produce a product. 
C) individual areas for employees so each can work independently without interruption. 
D) a flexible layout that can be easily adjusted to make a different product.

Question 5

Vander Belt Manufacturing, Inc., is considering reorganizing its plant into manufacturing cells. The following estimates have been prepared to evaluate the benefits from the reorganization:
  
-As a result of the layout reorganization,incremental manufacturing costs are projected to:

Accepted Answer

A) decrease by $22,800 annually. 
B) decrease by $25,000 annually. 
C) increase by $25,000 annually. 
D) increase by $40,000 annually. 
A) decrease by $22,800 annually. 
B) decrease by $25,000 annually. 
C) increase by $25,000 annually. 
D) increase by $40,000 annually.

Question 6

DJK Enterprises are using the Kaizen approach to budgeting for 2011 . The budgeted income statement for January 2011 is as follows:
 
Under the Kaizen approach, cost of goods sold and variable operating expenses are budgeted to decline by 1% per month.
-What is the budgeted cost of goods sold for March 2011?

Accepted Answer

A) $294,030 
B) $294,000 
C) $300,000 
D) $297,000 
A) $294,030 
B) $294,000 
C) $300,000 
D) $297,000

Question 7

Vander Belt Manufacturing, Inc., is considering reorganizing its plant into manufacturing cells. The following estimates have been prepared to evaluate the benefits from the reorganization:
  
-As a result of switching to a cellular manufacturing operation,total benefits are projected to increase annually by:

Accepted Answer

A) $222,800. 
B) $227,200. 
C) $272,800. 
D) $277,200. 
A) $222,800. 
B) $227,200. 
C) $272,800. 
D) $277,200.

Question 8

The implementation of just-in-time production results in all of the following EXCEPT:

Accepted Answer

A) decreased cycle times. 
B) reduced amount of waste. 
C) a slower pace for employees. 
D) structural changes. 
A) decreased cycle times. 
B) reduced amount of waste. 
C) a slower pace for employees. 
D) structural changes.

Question 9

Narly Skateboards manufactures three different product lines, Base, Long, and Trick. Considerable market demand exists for all models. The following per unit data apply:  
-If there is a machine breakdown,which model is the most profitable to produce?

Accepted Answer

A) base model 
B) long model 
C) trick model 
D) both the long model and the trick model 
A) base model 
B) long model 
C) trick model 
D) both the long model and the trick model

Question 10

How can the Vice-president of sales at Skate Magic encourage her salespeople to promote the more profitable model?

Accepted Answer

A) Put all sales persons on salary. 
B) Provide higher sales commissions for higher priced items. 
C) Provide higher sales commissions for items with the greatest contribution margin per constrained resource. 
D) Provide higher sales commissions for higher priced items and items with the greatest contribution margin per constrained resource. 
A) Put all sales persons on salary. 
B) Provide higher sales commissions for higher priced items. 
C) Provide higher sales commissions for items with the greatest contribution margin per constrained resource. 
D) Provide higher sales commissions for higher priced items and items with the greatest contribution margin per constrained resource.

Question 11

Benchmarking requires that organizational members first look to the best practices of other organizations for guidance on improving and then understand their current operations and approaches to conducting business,

Accepted Answer

A) True 
 B)False

Question 12

Vander Belt Manufacturing, Inc., is considering reorganizing its plant into manufacturing cells. The following estimates have been prepared to evaluate the benefits from the reorganization:
  
-After the change,work-in-process inventory carrying costs are projected to decrease because of:

Accepted Answer

A) reduced costs in materials handling. 
B) lower financing costs. 
C) the decreased need for inventory storage. 
D) All of the above are correct. 
A) reduced costs in materials handling. 
B) lower financing costs. 
C) the decreased need for inventory storage. 
D) All of the above are correct.

Question 13

In ________,all similar equipment or functions are grouped together.

Accepted Answer

A) a process layout 
B) a product layout 
C) cellular manufacturing 
D) just-in-time production 
A) a process layout 
B) a product layout 
C) cellular manufacturing 
D) just-in-time production

Question 14

In ________,equipment is organized to accommodate the production of a specific product.

Accepted Answer

A) a process layout 
B) a product layout 
C) cellular manufacturing 
D) low-volume production 
A) a process layout 
B) a product layout 
C) cellular manufacturing 
D) low-volume production

Question 15

The goal of standard costing is to reduce costs through small,incremental changes.

Accepted Answer

A) True 
 B)False

Question 16

A processing cycle efficiency (PCE)of 14% indicates better efficiency than a PCE of 50%.

Accepted Answer

A) True 
 B)False

Question 17

Inspection costs of purchased parts and materials are examples of:

Accepted Answer

A) prevention costs. 
B) appraisal costs. 
C) internal failure costs. 
D) external failure costs. 
A) prevention costs. 
B) appraisal costs. 
C) internal failure costs. 
D) external failure costs.

Question 18

All the statements below are true regarding Kaizen costing EXCEPT that:

Accepted Answer

A) cost-variance analysis compares target Kaizen costs with actual cost reduction amounts. 
B) cost reductions apply to all variable costs. 
C) workers are assumed to have the best knowledge to improve processes and reduce costs. 
D) cost reduction targets are set and applied on an annual basis. 
A) cost-variance analysis compares target Kaizen costs with actual cost reduction amounts. 
B) cost reductions apply to all variable costs. 
C) workers are assumed to have the best knowledge to improve processes and reduce costs. 
D) cost reduction targets are set and applied on an annual basis.

Question 19

Under kaizen costing,cost reduction targets are set and applied monthly and continuous improvement (kaizen)methods are applied all year long to meet targets.

Accepted Answer

A) True 
 B)False

Question 20

Implementing a just-in-time manufacturing system requires a major cultural change for an organization.

Accepted Answer

A) True 
 B)False

Kaizen costing requires relevant financial results to be shared with front-line employees.

Characteristics of cellular manufacturing include:

Vander Belt Manufacturing, Inc., is considering reorganizing its plant into manufacturing cells. The following estimates have been prepared to evaluate the benefits from the reorganization: -As a result of the layout reorganization,incremental manufacturing costs are projected to:

The implementation of just-in-time production results in all of the following EXCEPT:

Narly Skateboards manufactures three different product lines, Base, Long, and Trick. Considerable market demand exists for all models. The following per unit data apply: -If there is a machine breakdown,which model is the most profitable to produce?

How can the Vice-president of sales at Skate Magic encourage her salespeople to promote the more profitable model?

Benchmarking requires that organizational members first look to the best practices of other organizations for guidance on improving and then understand their current operations and approaches to conducting business,

Vander Belt Manufacturing, Inc., is considering reorganizing its plant into manufacturing cells. The following estimates have been prepared to evaluate the benefits from the reorganization: -After the change,work-in-process inventory carrying costs are projected to decrease because of:

In ________,all similar equipment or functions are grouped together.

In ________,equipment is organized to accommodate the production of a specific product.

The goal of standard costing is to reduce costs through small,incremental changes.

A processing cycle efficiency (PCE)of 14% indicates better efficiency than a PCE of 50%.

Inspection costs of purchased parts and materials are examples of:

All the statements below are true regarding Kaizen costing EXCEPT that:

Under kaizen costing,cost reduction targets are set and applied monthly and continuous improvement (kaizen)methods are applied all year long to meet targets.

Implementing a just-in-time manufacturing system requires a major cultural change for an organization.

How Management Accounting Information Supports Decision Making

The Balanced Scorecard and Strategy Map

Using Costs in Decision Making

Accumulating and Assigning Costs to Products

Activity-Based Cost Systems

Measuring and Managing Customer Relationships

Measuring and Managing Life-Cycle Costs

Behavioral and Organizational Issues in Management Accounting and Control Systems

Using Budgets for Planning and Coordination

Financial Control

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Exam 7: Measuring and Managing Process Performance

Kaizen costing requires relevant financial results to be shared with front-line employees.

Characteristics of cellular manufacturing include:

Vander Belt Manufacturing, Inc., is considering reorganizing its plant into manufacturing cells. The following estimates have been prepared to evaluate the benefits from the reorganization: -As a result of the layout reorganization,incremental manufacturing costs are projected to:

The implementation of just-in-time production results in all of the following EXCEPT:

Narly Skateboards manufactures three different product lines, Base, Long, and Trick. Considerable market demand exists for all models. The following per unit data apply: -If there is a machine breakdown,which model is the most profitable to produce?

How can the Vice-president of sales at Skate Magic encourage her salespeople to promote the more profitable model?

Benchmarking requires that organizational members first look to the best practices of other organizations for guidance on improving and then understand their current operations and approaches to conducting business,

Vander Belt Manufacturing, Inc., is considering reorganizing its plant into manufacturing cells. The following estimates have been prepared to evaluate the benefits from the reorganization: -After the change,work-in-process inventory carrying costs are projected to decrease because of:

In ________,all similar equipment or functions are grouped together.

In ________,equipment is organized to accommodate the production of a specific product.

The goal of standard costing is to reduce costs through small,incremental changes.

A processing cycle efficiency (PCE)of 14% indicates better efficiency than a PCE of 50%.

Inspection costs of purchased parts and materials are examples of:

All the statements below are true regarding Kaizen costing EXCEPT that:

Under kaizen costing,cost reduction targets are set and applied monthly and continuous improvement (kaizen)methods are applied all year long to meet targets.

Implementing a just-in-time manufacturing system requires a major cultural change for an organization.

How Management Accounting Information Supports Decision Making

The Balanced Scorecard and Strategy Map

Using Costs in Decision Making

Accumulating and Assigning Costs to Products

Activity-Based Cost Systems

Measuring and Managing Customer Relationships

Measuring and Managing Life-Cycle Costs

Behavioral and Organizational Issues in Management Accounting and Control Systems

Using Budgets for Planning and Coordination

Financial Control

Filters