Question 1

Which of the following activities would be part of the value chain of a manufacturer?

Accepted Answer

A) Inventory control 
B) Product design 
C) Cost accounting 
D) Materials storage 
A) Inventory control 
B) Product design 
C) Cost accounting 
D) Materials storage B

Question 2

Nonvalue-adding activity costs do not increase a product's cost because they do not add value to the product.

Accepted Answer

A) True 
 B)False  False

Question 3

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  True

Question 4

In just-in-time manufacturing,the basic cost classifications used in product costing are materials and overhead costs.

Accepted Answer

A) True 
 B)False

Question 5

Process value analysis (PVA)identifies all activities of a production and/or assembly operation for the purpose of

Accepted Answer

A) preparing budgets based on activity centers. 
B) determining the value of the process. 
C) replacing cost drivers used in cost assignment analyses with activities. 
D) relating cost assignment to the activities that caused the cost to be incurred. 
A) preparing budgets based on activity centers. 
B) determining the value of the process. 
C) replacing cost drivers used in cost assignment analyses with activities. 
D) relating cost assignment to the activities that caused the cost to be incurred.

Question 6

Lean's primary goal is to eliminate waste in business processes.

Accepted Answer

A) True 
 B)False

Question 7

The initial step in achieving the efficiency of a just-in-time system is to

Accepted Answer

A) redesign the plant layout. 
B) replace laborers with machines. 
C) stop ordering materials for inventory. 
D) identify products that are not profitable. 
A) redesign the plant layout. 
B) replace laborers with machines. 
C) stop ordering materials for inventory. 
D) identify products that are not profitable.

Question 8

Under new methods of management,attempts to continuously improve the work environment come from

Accepted Answer

A) top management. 
B) each department manager. 
C) the board of directors 
D) everyone in the company. 
A) top management. 
B) each department manager. 
C) the board of directors 
D) everyone in the company.

Question 9

In a backflush environment,costs are tracked through the various production departments as products or services move through the production process.

Accepted Answer

A) True 
 B)False

Question 10

Activity-based management and lean operations can be used either together or separately to eliminate waste and manage activities.

Accepted Answer

A) True 
 B)False

Question 11

A manufacturing chain is a path that leads from the suppliers of the materials from which a product is made to the final customer.

Accepted Answer

A) True 
 B)False

Question 12

To minimize costs,managers continuously seek to improve processes and activities.

Accepted Answer

A) True 
 B)False

Question 13

In a traditional manufacturing environment,both push-through and pull-through methods trigger scheduling of production.

Accepted Answer

A) True 
 B)False

Question 14

A value-adding activity is one that increases the cost of a product but does not add to the product's market value.

Accepted Answer

A) True 
 B)False

Question 15

Engineering design is an activity vital to the success of any motor vehicle manufacturer.Identify the level at which engineering design would be classified in the cost hierarchy used with ABC for a maker of built-to-order city and county emergency vehicles (orders are usually placed for 10 to 12 identical vehicles).

Accepted Answer

A) Unit-level activity 
B) Batch-level activity 
C) Product-level activity 
D) Facility-level activity 
A) Unit-level activity 
B) Batch-level activity 
C) Product-level activity 
D) Facility-level activity

Question 16

Which of the following is reduced by a just-in-time operations?

Accepted Answer

A) Inspection time and moving time 
B) Only storage time 
C) Moving time and processing time 
D) Inspection time and processing time 
A) Inspection time and moving time 
B) Only storage time 
C) Moving time and processing time 
D) Inspection time and processing time

Question 17

Which of the following is the major objective of the just-in-time operating environment?

Accepted Answer

A) To create push-through production 
B) To develop a multiskilled work force 
C) To substitute automation for manual operations 
D) To reduce waste and improve quality and productivity 
A) To create push-through production 
B) To develop a multiskilled work force 
C) To substitute automation for manual operations 
D) To reduce waste and improve quality and productivity

Question 18

When using backflush costing,product costs are first accumulated in the __________ account.

Accepted Answer

A) Cost of Goods Sold 
B) Work in Process Inventory 
C) Conversion Costs 
D) Finished Goods Inventory 
A) Cost of Goods Sold 
B) Work in Process Inventory 
C) Conversion Costs 
D) Finished Goods Inventory

Question 19

A nonvalue-adding activity is defined as a(n)

Accepted Answer

A) administrative or support activity that adds overhead cost to the product and increases its market value. 
B) activity that adds cost to a product but does not increase its market value. 
C) activity that adds no cost to the product but increases its market value. 
D) wasteful but unavoidable production activity. 
A) administrative or support activity that adds overhead cost to the product and increases its market value. 
B) activity that adds cost to a product but does not increase its market value. 
C) activity that adds no cost to the product but increases its market value. 
D) wasteful but unavoidable production activity.

Question 20

Which of the following is a batch-level activity?

Accepted Answer

A) Testing products 
B) Inspection 
C) Implementation of engineering changes 
D) Maintenance of the building 
A) Testing products 
B) Inspection 
C) Implementation of engineering changes 
D) Maintenance of the building

Exam 20: Value-Based Systems: Activity-Based Costing and Lean Accounting

Which of the following activities would be part of the value chain of a manufacturer?

Nonvalue-adding activity costs do not increase a product's cost because they do not add value to the product.

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

In just-in-time manufacturing,the basic cost classifications used in product costing are materials and overhead costs.

Process value analysis (PVA)identifies all activities of a production and/or assembly operation for the purpose of

Lean's primary goal is to eliminate waste in business processes.

The initial step in achieving the efficiency of a just-in-time system is to

Under new methods of management,attempts to continuously improve the work environment come from

In a backflush environment,costs are tracked through the various production departments as products or services move through the production process.

Activity-based management and lean operations can be used either together or separately to eliminate waste and manage activities.

A manufacturing chain is a path that leads from the suppliers of the materials from which a product is made to the final customer.

To minimize costs,managers continuously seek to improve processes and activities.

In a traditional manufacturing environment,both push-through and pull-through methods trigger scheduling of production.

A value-adding activity is one that increases the cost of a product but does not add to the product's market value.

Which of the following is reduced by a just-in-time operations?

Which of the following is the major objective of the just-in-time operating environment?

When using backflush costing,product costs are first accumulated in the __________ account.

A nonvalue-adding activity is defined as a(n)

Which of the following is a batch-level activity?

Accounting Principles and the Financial Statements

Analyzing and Recording Business Transactions

Adjusting the Accounts

Completing the Accounting Cycle

Foundations of Financial Reporting and the Classified Balance Sheet

Accounting for Merchandising Operations

Inventories

Cash and Internal Control

Receivables

Long -Term Assets

Current Liabilities and Fair Value Accounting

Accounting for Partnerships

Accounting for Corporations

Long Term Liabilities

The Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting and Cost Concepts

Costing Systems: Job Order Costing

Costing Systems Process Costing

Cost-Volume-Profit Analysis

The Budgeting Process

Flexible Budgets and Performance Analysis

Standard Costing and Variance Analysis

Short-Run Decision Analysis and Capital Budgeting

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