Question 1

From the above schedule of activity costs, determine the total activity cost.

Accepted Answer

A) $62,000 
B) $179,000 
C) $94,000 
D) $241,000 
A) $62,000 
B) $179,000 
C) $94,000 
D) $241,000

Question 2

Financial accounting information is used more often for long-term operating decisions and nonfinancial information is used more often for day-to-day decisions.

Accepted Answer

A) True 
 B)False

Question 3

Lead time is the process time between start and completion.

Accepted Answer

A) True 
 B)False

Question 4

Nonfinancial accounting information is used more often for long-term operating decisions than is financial information.

Accepted Answer

A) True 
 B)False

Question 5

Reducing wait time is not linked to reducing inventory.

Accepted Answer

A) True 
 B)False

Question 6

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 7

Identify the following quality control activities as either value-added or non-value-added.
-Scrap material

Accepted Answer

A) Value-added 
B) Non-value-added 
A) Value-added 
B) Non-value-added

Question 8

A setup is the time required to prepare an operation for a new production run.

Accepted Answer

A) True 
 B)False

Question 9

In a lean environment, the journal entry to record conversion costs would include a debit to the manufacturing overhead control account.

Accepted Answer

A) True 
 B)False

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is characteristic of the lean system?

Accepted Answer

A) Fewer work in process account transactions. 
B) Work in process and raw materials accounts combined. 
C) Elimination of the direct labor account. 
D) All of the above. 
A) Fewer work in process account transactions. 
B) Work in process and raw materials accounts combined. 
C) Elimination of the direct labor account. 
D) All of the above.

Question 12

Within-batch wait time increases total lead time.

Accepted Answer

A) True 
 B)False

Question 13

Examples of transforming a traditional manufacturing environment to a lean environment is to do all of the following except

Accepted Answer

A) form partnerships with reliable suppliers. 
B) reorganize operational processes to organized product lines. 
C) train employees to perform various operations. 
D) increase raw materials to produce more, thereby increasing finished goods inventory. 
A) form partnerships with reliable suppliers. 
B) reorganize operational processes to organized product lines. 
C) train employees to perform various operations. 
D) increase raw materials to produce more, thereby increasing finished goods inventory.

Question 14

The Bright Lamp Company has budgeted its conversion cost for the small lamp production as $85,000 for 1,300 production hours.Each unit produced by the cell requires 15 minutes of process time.During the month, 3,800 units are manufactured in the cell.The estimated material cost is $18 per unit.Provide the following journal entries.
a Materials are purchased to produce 4,000 units.
b Conversion costs are applied to 3,800 units of production.Please round to nearest cent.
c 3,650 units are placed into finished goods.

Accepted Answer

The answer of The Bright Lamp Company has budgeted its...

Question 15

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

Accepted Answer

A) True 
 B)False

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

Lead time includes both value-added time and non-value-added time.

Accepted Answer

A) True 
 B)False

Question 18

The budgeted cell conversion cost rate includes which of the following?

Accepted Answer

A) only factory overhead 
B) only direct labor and direct materials 
C) direct labor, direct materials, and factory overhead 
D) only direct labor and factory overhead 
A) only factory overhead 
B) only direct labor and direct materials 
C) direct labor, direct materials, and factory overhead 
D) only direct labor and factory overhead

Question 19

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

Question 20

Setups are a significant time-consuming activity in traditional production environments.

Accepted Answer

A) True 
 B)False

From the above schedule of activity costs, determine the total activity cost.

Financial accounting information is used more often for long-term operating decisions and nonfinancial information is used more often for day-to-day decisions.

Lead time is the process time between start and completion.

Nonfinancial accounting information is used more often for long-term operating decisions than is financial information.

Reducing wait time is not linked to reducing inventory.

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

Identify the following quality control activities as either value-added or non-value-added. -Scrap material

A setup is the time required to prepare an operation for a new production run.

In a lean environment, the journal entry to record conversion costs would include a debit to the manufacturing overhead control account.

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

Which of the following is characteristic of the lean system?

Within-batch wait time increases total lead time.

Examples of transforming a traditional manufacturing environment to a lean environment is to do all of the following except

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

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

Lead time includes both value-added time and non-value-added time.

The budgeted cell conversion cost rate includes which of the following?

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.

Setups are a significant time-consuming activity in traditional production environments.

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

Statement of Cash Flows

Financial Statement Analysis

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Exam 12: Lean Principles, Lean Accounting, and Activity Analysis

From the above schedule of activity costs, determine the total activity cost.

Financial accounting information is used more often for long-term operating decisions and nonfinancial information is used more often for day-to-day decisions.

Lead time is the process time between start and completion.

Nonfinancial accounting information is used more often for long-term operating decisions than is financial information.

Reducing wait time is not linked to reducing inventory.

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

Identify the following quality control activities as either value-added or non-value-added. -Scrap material

A setup is the time required to prepare an operation for a new production run.

In a lean environment, the journal entry to record conversion costs would include a debit to the manufacturing overhead control account.

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

Which of the following is characteristic of the lean system?

Within-batch wait time increases total lead time.

Examples of transforming a traditional manufacturing environment to a lean environment is to do all of the following except

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

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

Lead time includes both value-added time and non-value-added time.

The budgeted cell conversion cost rate includes which of the following?

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.

Setups are a significant time-consuming activity in traditional production environments.

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

Statement of Cash Flows

Financial Statement Analysis

Filters