Question 1

In a just-in-time (JIT) system, there are fewer transactions to record than there are in a traditional system.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is a value-added activity?

Accepted Answer

A)  scrap processing 
B)  rework 
C)  preventive maintenance 
D)  warranty work 
A)  scrap processing 
B)  rework 
C)  preventive maintenance 
D)  warranty work

Question 3

In a just-in-time (JIT) environment, operations only respond to customer orders.

Accepted Answer

A) True 
 B)False

Question 4

In the just-in-time (JIT) philosophy, unexpected downtime is the result of unreliable processes.

Accepted Answer

A) True 
 B)False

Question 5

The budgeted cell conversion cost rate is very similar to the predetermined factory rate because both include only factory overhead costs.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following is not a prevention cost?

Accepted Answer

A)  preventive maintenance 
B)  operator training 
C)  design engineering 
D)  testing finished products 
A)  preventive maintenance 
B)  operator training 
C)  design engineering 
D)  testing finished products

Question 7

Set up time is disregarded as an improvement priority under the ____ manufacturing concept.

Accepted Answer

A)  traditional 
B)  just-in-time 
C)  total quality management 
D)  product cost 
A)  traditional 
B)  just-in-time 
C)  total quality management 
D)  product cost

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements is correct?

Accepted Answer

A)  Costs of controlling quality include prevention and appraisal costs. 
B)  Costs of failing to control quality include internal and external failure costs. 
C)  A and B are both correct. 
D)  A and B are both incorrect. 
A)  Costs of controlling quality include prevention and appraisal costs. 
B)  Costs of failing to control quality include internal and external failure costs. 
C)  A and B are both correct. 
D)  A and B are both incorrect.

Question 10

Employee involvement in a product-oriented factory emphasizes employee teams, rather than individual employees.

Accepted Answer

A) True 
 B)False

Question 11

In a push manufacturing system, raw materials are released to production based on actual customer orders.

Accepted Answer

A) True 
 B)False

Question 12

A make-to-order company matches its production schedules to actual customer orders.

Accepted Answer

A) True 
 B)False

Question 13

In a pull manufacturing system, raw materials are released to production based on forecasted demand.

Accepted Answer

A) True 
 B)False

Question 14

Sifton Electronics Corporation manufactures and assembles electronic motor drives for video cameras. The company assembles the motor drives for several accounts. The process consists of a just-in-time cell for each customer. The following information relates only to one customer's just-in-time cell for the coming year. Projected labor and overhead, $7,370,000; materials costs, $28 per unit. Planned production included 4,000 hours to produce 27,500 motor drives. Actual production for August was 1,600 units, and motor drives shipped amounted to 1,380 units. From the foregoing information, determine the production costs transferred to Cost of Goods Sold during August.

Accepted Answer

A)  $369,840 
B)  $408,480 
C)  $428,800 
D)  $473,600 
A)  $369,840 
B)  $408,480 
C)  $428,800 
D)  $473,600

Question 15

Make-to-order companies typically produce in small batch sizes.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following is considered non-value-added lead time?

Accepted Answer

A)  packing 
B)  moving from process to process 
C)  converting raw materials to finished product 
D)  all of the above 
A)  packing 
B)  moving from process to process 
C)  converting raw materials to finished product 
D)  all of the above

Question 17

A non-financial measure is operating information that has not been translated into dollars.

Accepted Answer

A) True 
 B)False

Question 18

Employee involvement does not include performing any indirect manufacturing functions.

Accepted Answer

A) True 
 B)False

Question 19

Schedule of Activity Costs
   From the above schedule, calculate the (a) prevention and (b) appraisal costs.

Accepted Answer

(a) $102,000 = $26,0

Question 20

Maximum effectiveness and efficiency are reached when the just-in-time (JIT) philosophy is used only by manufacturers.

Accepted Answer

A) True 
 B)False

Exam 27: Cost Management for Just-In-Time Environments

In a just-in-time (JIT) system, there are fewer transactions to record than there are in a traditional system.

Which of the following is a value-added activity?

In a just-in-time (JIT) environment, operations only respond to customer orders.

In the just-in-time (JIT) philosophy, unexpected downtime is the result of unreliable processes.

The budgeted cell conversion cost rate is very similar to the predetermined factory rate because both include only factory overhead costs.

Which of the following is not a prevention cost?

Set up time is disregarded as an improvement priority under the ____ manufacturing concept.

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

Which of the following statements is correct?

Employee involvement in a product-oriented factory emphasizes employee teams, rather than individual employees.

In a push manufacturing system, raw materials are released to production based on actual customer orders.

A make-to-order company matches its production schedules to actual customer orders.

In a pull manufacturing system, raw materials are released to production based on forecasted demand.

Make-to-order companies typically produce in small batch sizes.

Which of the following is considered non-value-added lead time?

A non-financial measure is operating information that has not been translated into dollars.

Employee involvement does not include performing any indirect manufacturing functions.

Schedule of Activity Costs From the above schedule, calculate the (a) prevention and (b) appraisal costs.

Maximum effectiveness and efficiency are reached when the just-in-time (JIT) philosophy is used only by manufacturers.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

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 and Product Pricing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

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