Question 1

Backflush costing aims at reducing waste in the

Accepted Answer

A)  accounting system. 
B)  cost of goods sold. 
C)  storage of raw materials. 
D)  production process. 
A)  accounting system. 
B)  cost of goods sold. 
C)  storage of raw materials. 
D)  production process. A

Question 2

Activity-based management is an extension of activity-based costing.

Accepted Answer

A) True 
 B)False  False

Question 3

Distinguish between a supply chain and a value chain.How do they relate to each other?

Accepted Answer

A supply chain is a collection of companies that supply a customer with materials,products,and services.The company's supply chain includes suppliers and suppliers' suppliers as well as customers and customers' customers.On the other hand,a value chain is a sequence of value-creating activities within the organization.Supply chains link the value chains of a company and include the value chains of its suppliers and customers.

Question 4

Which of the following statements is true?

Accepted Answer

A)  A company's value chain is not part of its supply chain. 
B)  A manufacturer's supply chain typically includes research and development and customer service. 
C)  A company's supply chain includes the value chains of its suppliers. 
D)  Your supplier's suppliers are part of your value chain. 
A)  A company's value chain is not part of its supply chain. 
B)  A manufacturer's supply chain typically includes research and development and customer service. 
C)  A company's supply chain includes the value chains of its suppliers. 
D)  Your supplier's suppliers are part of your value chain.

Question 5

Xavier Products Company is in the process of adopting the just-in-time operating philosophy for its trophy-making operations.Indicate which of the following overhead costs is a nonvalue-adding cost (NVA).

Accepted Answer

A)  Machine electricity 
B)  Machine repairs 
C)  Depreciation of the coffee machine 
D)  Machine setup labor 
A)  Machine electricity 
B)  Machine repairs 
C)  Depreciation of the coffee machine 
D)  Machine setup labor

Question 6

How do managers measure an activity's performance?

Accepted Answer

Managers can measure an activity's perfo

Question 7

In a just-in-time environment,managing the production process focuses on

Accepted Answer

A)  total processing time per unit. 
B)  allocating overhead more accurately. 
C)  reducing inventories. 
D)  units produced per direct labor hour. 
A)  total processing time per unit. 
B)  allocating overhead more accurately. 
C)  reducing inventories. 
D)  units produced per direct labor hour.

Question 8

The customer's perspective governs whether an activity adds value to a product or service.

Accepted Answer

A) True 
 B)False

Question 9

The just-in-time operating environment typically is characterized by the positioning of all similar machines together on the factory floor.

Accepted Answer

A) True 
 B)False

Question 10

A just-in-time environment has smaller inventories than the traditional manufacturing environment.As a result,

Accepted Answer

A)  larger production lot sizes are the rule, in order to realize the cost-effectiveness of long production runs. 
B)  the amount of working capital required for inventory typically increases. 
C)  the just-in-time environment experiences a lower inventory turnover than the traditional environment. 
D)  the just-in-time environment typically experiences a higher inventory turnover than the traditional environment. 
A)  larger production lot sizes are the rule, in order to realize the cost-effectiveness of long production runs. 
B)  the amount of working capital required for inventory typically increases. 
C)  the just-in-time environment experiences a lower inventory turnover than the traditional environment. 
D)  the just-in-time environment typically experiences a higher inventory turnover than the traditional environment.

Question 11

Which of the following statements contradicts the philosophy underlying the just-in-time operating environment?

Accepted Answer

A)  The work force must become multiskilled in order to operate many different machines and perform other tasks in the work cell. 
B)  A customer order triggers the purchase of materials and the activation of the production process. 
C)  Large inventories are maintained in order to fulfill customer orders on a timely basis. 
D)  Flexible work cells are created to increase productivity. 
A)  The work force must become multiskilled in order to operate many different machines and perform other tasks in the work cell. 
B)  A customer order triggers the purchase of materials and the activation of the production process. 
C)  Large inventories are maintained in order to fulfill customer orders on a timely basis. 
D)  Flexible work cells are created to increase productivity.

Question 12

Value-based systems are information systems that provide only customer-related information but not activity-based information.

Accepted Answer

A) True 
 B)False

Question 13

The Yeva Company produces children's automobile car seats.The company recently changed from a traditional production environment to just-in-time work cells.The company's car seats are widely distributed in popular retail stores.Would you recommend the use of backflush costing or ABM/ABC for tracking product costs? Explain your choice of system.

Accepted Answer

Yeva produces a large quantity of simila

Question 14

A cost hierarchy and a bill of activities are tools for the implementation of activity-based costing.

Accepted Answer

A) True 
 B)False

Question 15

Explain how a just-in-time operating philosophy reduces the time it takes to complete the production of a product.Include in your answer the classifications of time that are affected.How does such a change help to reduce product costs?

Accepted Answer

The basic ingredient in the just-in-time

Question 16

Identify the following activities,for an automobile manufacturer,as either value-adding (V)or nonvalue-adding (NV).
_____
a. _____Moving products
b. _____Storing parts
c. _____Research and
development
d. _____Inventory control
e. _____Production
_____ f. Customer service
_____ g. Cost accounting
_____ h. Engineering

Accepted Answer

a.NV 
b.NV

Question 17

Maintaining consistent high product quality

Accepted Answer

A)  is both required for and a by-product of the just-in-time environment. 
B)  is difficult to obtain in a just-in-time environment because of the severe time constraints imposed by the just-in-time environment. 
C)  requires quality control inspectors at each step of the production process. 
D)  is too expensive to obtain in a just-in-time environment. 
A)  is both required for and a by-product of the just-in-time environment. 
B)  is difficult to obtain in a just-in-time environment because of the severe time constraints imposed by the just-in-time environment. 
C)  requires quality control inspectors at each step of the production process. 
D)  is too expensive to obtain in a just-in-time environment.

Question 18

A just-in-time operating environment requires maintenance of large material and finished goods inventories in order to meet customer demand for products.

Accepted Answer

A) True 
 B)False

Question 19

The value chain is also called the supply network.

Accepted Answer

A) True 
 B)False

Question 20

The value chain is the sequence of business activities in which usefulness is added to the products or the services within an organization.

Accepted Answer

A) True 
 B)False

Exam 19: Value-Based Systems- Abm and Lean

Backflush costing aims at reducing waste in the

Activity-based management is an extension of activity-based costing.

Distinguish between a supply chain and a value chain.How do they relate to each other?

Which of the following statements is true?

Xavier Products Company is in the process of adopting the just-in-time operating philosophy for its trophy-making operations.Indicate which of the following overhead costs is a nonvalue-adding cost (NVA).

How do managers measure an activity's performance?

In a just-in-time environment,managing the production process focuses on

The customer's perspective governs whether an activity adds value to a product or service.

The just-in-time operating environment typically is characterized by the positioning of all similar machines together on the factory floor.

A just-in-time environment has smaller inventories than the traditional manufacturing environment.As a result,

Which of the following statements contradicts the philosophy underlying the just-in-time operating environment?

Value-based systems are information systems that provide only customer-related information but not activity-based information.

A cost hierarchy and a bill of activities are tools for the implementation of activity-based costing.

Explain how a just-in-time operating philosophy reduces the time it takes to complete the production of a product.Include in your answer the classifications of time that are affected.How does such a change help to reduce product costs?

Maintaining consistent high product quality

A just-in-time operating environment requires maintenance of large material and finished goods inventories in order to meet customer demand for products.

The value chain is also called the supply network.

The value chain is the sequence of business activities in which usefulness is added to the products or the services within an organization.

Uses of Accounting Information and the Financial Statements

Analyzing Business Transactions

Measuring Business Income

Supplement - Closing Entries and the Work Sheet

Financial Reporting and Analysis

The Operating Cycle and Merchandising Operations

Inventories

Cash and Receivables

Current Liabilities and Fair Value Accounting

Long Term Assets

Long-Term Liabilities

Contributed Capital

Investments

The Corporate Income Statement and the Statement of Stockholders Equity

The Statement of Cash Flows

The Changing Business Environment - a Managers Perspective

Cost Concepts and Cost Allocation

Costing Systems- Job Order Costing

Costing Systems- Process Costing

Cost Behavior Analysis

The Budgeting Process

Performance Management and Evaluation

Standard Costing and Variance Analysis

Short Run Decision Analysis

Capital Investment Analysis

Pricing Decisions, incltarget Costing and Transfer Pricing

Quality Management and Measurement

Financial Analysis of Performance

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