Question 1

Which of the following is a value-added activity?

Accepted Answer

A)  moving 
B)  inspection 
C)  processing 
D)  waiting 
A)  moving 
B)  inspection 
C)  processing 
D)  waiting

Question 2

Warranty work is a(n)

Accepted Answer

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

Question 3

Which of the following describes a kaizen cost reduction process?

Accepted Answer

A)  It has two process cycles, namely, continuous improvement and maintenance. 
B)  It includes a kaizen standard, which is an ideal standard. 
C)  A maximum standard is set for future performance based on the current kaizen standard attained. 
D)  both a and c 
A)  It has two process cycles, namely, continuous improvement and maintenance. 
B)  It includes a kaizen standard, which is an ideal standard. 
C)  A maximum standard is set for future performance based on the current kaizen standard attained. 
D)  both a and c

Question 4

Figure 21-8
At the beginning of the year, Grant Company initiated a quality improvement program. The program was successful in reducing scrap and rework costs. To help assess the impact of the quality improvement program, the following data were collected for the current and preceding years:  
-What is a materials pull (Kanban) system? What is required to make this system work? What are some of the system's advantages?

Accepted Answer

The materials pull system, also know as

Question 5

Figure 21-8
At the beginning of the year, Grant Company initiated a quality improvement program. The program was successful in reducing scrap and rework costs. To help assess the impact of the quality improvement program, the following data were collected for the current and preceding years:  
-Refer to Figure 21-8. As a result of quality improvements, profits have increased by

Accepted Answer

A)  £97,500. 
B)  £61,500. 
C)  £22,500. 
D)  £15,000. 
A)  £97,500. 
B)  £61,500. 
C)  £22,500. 
D)  £15,000.

Question 6

Figure 21-5
At the beginning of this year, Sammie Company installed a JIT purchasing and manufacturing system. The following information has been gathered about one of the company's products:  
-Refer to Figure 21-5. Sammie's goal for defective units as a percentage of total units produced would be

Accepted Answer

A)  3.0%. 
B)  2.5%. 
C)  1.5%. 
D)  0%. 
A)  3.0%. 
B)  2.5%. 
C)  1.5%. 
D)  0%.

Question 7

A technique for improving performance of activities and processes that searches for best practices is called

Accepted Answer

A)  value-added reporting. 
B)  kaizen costing. 
C)  trend reporting. 
D)  benchmarking. 
A)  value-added reporting. 
B)  kaizen costing. 
C)  trend reporting. 
D)  benchmarking.

Question 8

Figure 21-5
At the beginning of this year, Sammie Company installed a JIT purchasing and manufacturing system. The following information has been gathered about one of the company's products:  
-Which of the following stages comes first?

Accepted Answer

A)  Introduction 
B)  Growth 
C)  Development 
D)  Decline 
A)  Introduction 
B)  Growth 
C)  Development 
D)  Decline

Question 9

Which of the following is an example of a nonvalue-added manufacturing activity?

Accepted Answer

A)  assembly 
B)  scheduling 
C)  finishing 
D)  All are value-added activities. 
A)  assembly 
B)  scheduling 
C)  finishing 
D)  All are value-added activities.

Question 10

Figure 21-8
At the beginning of the year, Grant Company initiated a quality improvement program. The program was successful in reducing scrap and rework costs. To help assess the impact of the quality improvement program, the following data were collected for the current and preceding years:  
-Clark, SA., sells one of its products for £150 each. Sales volume averages 800 units per year. Recently, its main competitor reduced the price of its product to £130. Clark expects sales to drop dramatically unless it matches the competitor's price. In addition, the current profit per unit must be maintained. Information about the product (for production of 800) is as follows:   Required: 
a.
Calculate the target cost for maintaining current market share and profitability.
b.
Calculate the nonvalue-added cost per unit.
c.
If nonvalue-added costs can be reduced to zero, can the target cost be achieved?

Accepted Answer

The answer of Figure 21-8
At the beginning of the year,...

Question 11

The Kanban system is used to

Accepted Answer

A)  ensure parts or materials are available when needed. 
B)  signal when preventive maintenance is needed. 
C)  signal when a defective unit has been produced. 
D)  ensure idle time of workers is not wasted. 
A)  ensure parts or materials are available when needed. 
B)  signal when preventive maintenance is needed. 
C)  signal when a defective unit has been produced. 
D)  ensure idle time of workers is not wasted.

Question 12

Which of the following is NOT a detection activity?

Accepted Answer

A)  inspecting products and processes 
B)  developing environmental performance measures 
C)  testing for contamination 
D)  operating pollution control equipment 
A)  inspecting products and processes 
B)  developing environmental performance measures 
C)  testing for contamination 
D)  operating pollution control equipment

Question 13

Figure 21-8
At the beginning of the year, Grant Company initiated a quality improvement program. The program was successful in reducing scrap and rework costs. To help assess the impact of the quality improvement program, the following data were collected for the current and preceding years:  
-____ calls for establishing cost reduction targets for products or services that an organization is currently providing to customers.

Accepted Answer

A)  Target costing 
B)  Kaizen costing 
C)  Process reengineering 
D)  Activity-based costing 
A)  Target costing 
B)  Kaizen costing 
C)  Process reengineering 
D)  Activity-based costing

Question 14

With JIT manufacturing, the major variable cost remaining is

Accepted Answer

A)  direct materials. 
B)  overhead. 
C)  inventory. 
D)  direct labour. 
A)  direct materials. 
B)  overhead. 
C)  inventory. 
D)  direct labour.

Question 15

Figure 21-5
At the beginning of this year, Sammie Company installed a JIT purchasing and manufacturing system. The following information has been gathered about one of the company's products:  
-Refer to Figure 21-5. Sammie's actual cycle time for this year would be

Accepted Answer

A)  1.8 hours per unit. 
B)  0.90 hours per unit. 
C)  0.56 hours per unit. 
D)  0.50 hours per unit. 
A)  1.8 hours per unit. 
B)  0.90 hours per unit. 
C)  0.56 hours per unit. 
D)  0.50 hours per unit.

Which of the following is a value-added activity?

Warranty work is a(n)

Which of the following describes a kaizen cost reduction process?

Figure 21-5 At the beginning of this year, Sammie Company installed a JIT purchasing and manufacturing system. The following information has been gathered about one of the company's products: -Refer to Figure 21-5. Sammie's goal for defective units as a percentage of total units produced would be

A technique for improving performance of activities and processes that searches for best practices is called

Figure 21-5 At the beginning of this year, Sammie Company installed a JIT purchasing and manufacturing system. The following information has been gathered about one of the company's products: -Which of the following stages comes first?

Which of the following is an example of a nonvalue-added manufacturing activity?

The Kanban system is used to

Which of the following is NOT a detection activity?

With JIT manufacturing, the major variable cost remaining is

Figure 21-5 At the beginning of this year, Sammie Company installed a JIT purchasing and manufacturing system. The following information has been gathered about one of the company's products: -Refer to Figure 21-5. Sammie's actual cycle time for this year would be

Introduction to Management Accounting

An Introduction to Cost Terms and Concepts

Cost Assignment

Accounting Entries for a Job Costing System

Process Costing

Joint and By-Product Costing

Income Effects of Alternative Cost Accumulation Systems

Cost-Volume-Profit Analysis

Measuring Relevant Costs and Revenues for Decision-Making

Activity-Based Costing

Pricing Decisions and Profitability Analysis

Decision-Making Under Conditions of Risk and Uncertainty

Capital Investment Decisions: Appraisal Methods

Capital Investment Decisions: the Impact of Capital Rationing, Taxation, Inflation and Risk

The Budgeting Process

Management Control Systems

Standard Costing and Variance Analysis 1

Standard Costing and Variance Analysis 2: Further Aspects

Divisional Financial Performance Measures

Transfer Pricing in Divisionalized Companies

Strategic Management Accounting

Cost Estimation and Cost Behaviour

Quantitative Models for the Planning and Control of Stocks

The Application of Linear Programming to Management Accounting

Filters

Exam 21: Cost Management

Which of the following is a value-added activity?

Warranty work is a(n)

Which of the following describes a kaizen cost reduction process?

Figure 21-5 At the beginning of this year, Sammie Company installed a JIT purchasing and manufacturing system. The following information has been gathered about one of the company's products: -Refer to Figure 21-5. Sammie's goal for defective units as a percentage of total units produced would be

A technique for improving performance of activities and processes that searches for best practices is called

Figure 21-5 At the beginning of this year, Sammie Company installed a JIT purchasing and manufacturing system. The following information has been gathered about one of the company's products: -Which of the following stages comes first?

Which of the following is an example of a nonvalue-added manufacturing activity?

The Kanban system is used to

Which of the following is NOT a detection activity?

With JIT manufacturing, the major variable cost remaining is

Figure 21-5 At the beginning of this year, Sammie Company installed a JIT purchasing and manufacturing system. The following information has been gathered about one of the company's products: -Refer to Figure 21-5. Sammie's actual cycle time for this year would be

Introduction to Management Accounting

An Introduction to Cost Terms and Concepts

Cost Assignment

Accounting Entries for a Job Costing System

Process Costing

Joint and By-Product Costing

Income Effects of Alternative Cost Accumulation Systems

Cost-Volume-Profit Analysis

Measuring Relevant Costs and Revenues for Decision-Making

Activity-Based Costing

Pricing Decisions and Profitability Analysis

Decision-Making Under Conditions of Risk and Uncertainty

Capital Investment Decisions: Appraisal Methods

Capital Investment Decisions: the Impact of Capital Rationing, Taxation, Inflation and Risk

The Budgeting Process

Management Control Systems

Standard Costing and Variance Analysis 1

Standard Costing and Variance Analysis 2: Further Aspects

Divisional Financial Performance Measures

Transfer Pricing in Divisionalized Companies

Strategic Management Accounting

Cost Estimation and Cost Behaviour

Quantitative Models for the Planning and Control of Stocks

The Application of Linear Programming to Management Accounting

Filters