Question 1

As per control charts, random variations would most likely occur when ________.

Accepted Answer

A)  there is a sudden increase in production 
B)  chance fluctuations in the speed of equipment cause defective products to be produced 
C)  defective products are produced as a result of a systematic problem 
D)  chance fluctuations in the speed of the equipment cause defective products to be produced 
A)  there is a sudden increase in production 
B)  chance fluctuations in the speed of equipment cause defective products to be produced 
C)  defective products are produced as a result of a systematic problem 
D)  chance fluctuations in the speed of the equipment cause defective products to be produced

Question 2

Speedy Dress Manufacturing has two workstations, cutting and finishing. The cutting station is limited by the speed of operating the cutting machine. Finishing is limited by the speed of the workers. Finishing normally waits for work from cutting. Each department works an eight-hour day. If cutting begins work two hours earlier than finishing each day, the two departments generally finish their work at about the same time. Not only does this eliminate the bottleneck, but also it increases finished units produced each day by 210 units. All units produced can be sold even though the change increases inventory stock by 15% from 430 units. The cost of operating the cutting department two more hours each day is $1430. The contribution margin of the finished products is $12 each. Inventory carrying costs are $0.50 per unit per day.
What is the change in the daily contribution margin if the change is made?

Accepted Answer

A)  $684 
B)  $703 
C)  $1058 
D)  $715 
A)  $684 
B)  $703 
C)  $1058 
D)  $715

Question 3

Which of the following is an advantage of nonfinancial measures of quality?

Accepted Answer

A)  They help managers aggregate costs to evaluate the tradeoffs of incurring prevention costs and appraisal costs to eliminate internal and external failure costs. 
B)  They detect and provide immediate short-run feedback on whether quality-improvement efforts are succeeding. 
C)  They focus managers' attention on how poor quality affects operating income. 
D)  They direct attention to financial processes that help managers identify the precise problem areas that need improvement. 
A)  They help managers aggregate costs to evaluate the tradeoffs of incurring prevention costs and appraisal costs to eliminate internal and external failure costs. 
B)  They detect and provide immediate short-run feedback on whether quality-improvement efforts are succeeding. 
C)  They focus managers' attention on how poor quality affects operating income. 
D)  They direct attention to financial processes that help managers identify the precise problem areas that need improvement.

Question 4

Two common operational measures of time are customer-response time and on-time performance.

Accepted Answer

A) True 
 B)False

Question 5

Prevention costs include inspection and product testing.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following is a chart which indicates how frequently each type of defect occurs?

Accepted Answer

A)  control chart 
B)  Pareto diagram 
C)  scatter diagram 
D)  fishbone diagram 
A)  control chart 
B)  Pareto diagram 
C)  scatter diagram 
D)  fishbone diagram

Question 7

Manufacturing cycle times affect both revenues and costs. Explain.

Accepted Answer

Revenues are affected because customers

Question 8

Warranty costs is an example of external failure costs.

Accepted Answer

A) True 
 B)False

Question 9

The costs of quality are the costs incurred ________.

Accepted Answer

A)  to enhance large scale production 
B)  to prevent the production of a low quality product 
C)  due to defective and low quality product 
D)  because of warranties, normal spoilage, abnormal spoilage, and scrap 
A)  to enhance large scale production 
B)  to prevent the production of a low quality product 
C)  due to defective and low quality product 
D)  because of warranties, normal spoilage, abnormal spoilage, and scrap

Question 10

Which of the following is an opportunity cost?

Accepted Answer

A)  lost sales 
B)  cost of production 
C)  marginal cost 
D)  cost of sales 
A)  lost sales 
B)  cost of production 
C)  marginal cost 
D)  cost of sales

As per control charts, random variations would most likely occur when ________.

Which of the following is an advantage of nonfinancial measures of quality?

Two common operational measures of time are customer-response time and on-time performance.

Prevention costs include inspection and product testing.

Which of the following is a chart which indicates how frequently each type of defect occurs?

Manufacturing cycle times affect both revenues and costs. Explain.

Warranty costs is an example of external failure costs.

The costs of quality are the costs incurred ________.

Which of the following is an opportunity cost?

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, Direct-Cost Variances, and Management Control

Flexible Budgets, Overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, Common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, Rework, and Scrap

Inventory Management, Just-in-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing, and Multinational Considerations

Performance Measurement, Compensation, and Multinational Considerations

Filters

Exam 19: Balanced Scorecard: Quality and Time

As per control charts, random variations would most likely occur when ________.

Which of the following is an advantage of nonfinancial measures of quality?

Two common operational measures of time are customer-response time and on-time performance.

Prevention costs include inspection and product testing.

Which of the following is a chart which indicates how frequently each type of defect occurs?

Manufacturing cycle times affect both revenues and costs. Explain.

Warranty costs is an example of external failure costs.

The costs of quality are the costs incurred ________.

Which of the following is an opportunity cost?

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Job Costing

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, Direct-Cost Variances, and Management Control

Flexible Budgets, Overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, Common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, Rework, and Scrap

Inventory Management, Just-in-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing, and Multinational Considerations

Performance Measurement, Compensation, and Multinational Considerations

Filters