Question 1

A make-to-order firm will work with the customer to design the product and then make it from purchased materials, parts, and components.

Accepted Answer

A) True 
 B)False  False

Question 2

You are hired as a consultant to decide if your client should purchase a new, highly specialized piece of equipment.The product to be produced by this equipment is forecast to have a total worldwide demand of 15,000 units over the entire product life.The initial investment to acquire and install the equipment is $256,000.The variable cost to produce each unit will be $15, and the selling price for the finished product will be $30.Which of the following best describes the situation the firm is facing?

Accepted Answer

A) The company will recover its initial investment. 
B) The company's total margin will be less than its investment. 
C) It is a good investment. 
D) The break-even is lower than the 15,000 units that are expected to sell. 
E) All of these 
A) The company will recover its initial investment. 
B) The company's total margin will be less than its investment. 
C) It is a good investment. 
D) The break-even is lower than the 15,000 units that are expected to sell. 
E) All of these B

Question 3

Assume a fixed cost for a process of $100,000.The variable cost to produce each unit of product is $10, and the selling price for the finished product is $50.Ignoring inventory, how many units must the firm sell to break even? ______________________

Accepted Answer

2,500 units
Explanation: Contribution margin per unit = $50 - $10 = $40.Break even = $100,000/$40 = 2,500.

Question 4

Process selection refers to the strategic decision of choosing the volume of output to produce in a manufacturing facility depending upon the way that facility produces.

Accepted Answer

A) True 
 B)False

Question 5

The placement of which of the following is not determined by production process organization decisions?

Accepted Answer

A) Departments 
B) Work groups 
C) Workstations 
D) Machines 
E) Emergency exits 
A) Departments 
B) Work groups 
C) Workstations 
D) Machines 
E) Emergency exits

Question 6

A project layout is characterized by a high degree of task ordering.

Accepted Answer

A) True 
 B)False

Question 7

Work-center layouts allocate dissimilar machines into cells to work on products that have dissimilar processing requirements.

Accepted Answer

A) True 
 B)False

Question 8

Assume a fixed cost for a process of $120,000.The variable cost to produce each unit of product is $35, and the selling price for the finished product is $50.Which of the following is the number of units that has to be produced and sold to break even?

Accepted Answer

A) 5,000 units 
B) 6,000 units 
C) 8,000 units 
D) 11,000 units 
E) 12,000 units 
A) 5,000 units 
B) 6,000 units 
C) 8,000 units 
D) 11,000 units 
E) 12,000 units

Question 9

Engineer-to-order firms will work with the customer to design the product and then make it from purchased materials, parts, and components.

Accepted Answer

A) True 
 B)False

Question 10

The essential issue in satisfying customers in the make-to-stock environment is to balance the cost of the finished item against the willingness of the consumer to pay for it.

Accepted Answer

A) True 
 B)False

Question 11

A high-level map or diagram of a supply chain process can be useful to understand how material flows and where inventory is held.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following basic types of process structures is one in which equipment or work processes are arranged according to the progressive steps by which the product is made?

Accepted Answer

A) Project 
B) Work center 
C) Manufacturing cell 
D) Assembly line 
E) Continuous process 
A) Project 
B) Work center 
C) Manufacturing cell 
D) Assembly line 
E) Continuous process

Question 13

Break-even analysis can only be used in production equipment decision making when dealing solely with fixed costs, not variable costs.

Accepted Answer

A) True 
 B)False

Question 14

The term "assembly line" refers to progressive assembly linked by some material handling device.

Accepted Answer

A) True 
 B)False

Question 15

One difference between an assembly line process flow and a continuous process flow is that on the assembly line the flow is discrete rather than continuous.

Accepted Answer

A) True 
 B)False

Question 16

The focus in the make-to-stock environment is on providing finished goods where and when the customers want them.

Accepted Answer

A) True 
 B)False

Question 17

A general-purpose machine is less capable than a special-purpose machine in certain tasks but can perform a broader variety of tasks.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following is not considered a major work flow structure?

Accepted Answer

A) Work center 
B) Project 
C) Assembly line 
D) Fabrication 
E) Continuous flow 
A) Work center 
B) Project 
C) Assembly line 
D) Fabrication 
E) Continuous flow

Question 19

Describe the implications of the product-process matrix for process design in a competitive situation.

Accepted Answer

The product-process matrix is represente

Question 20

Which of the following is not a basic type of process structure?

Accepted Answer

A) Product-process matrix 
B) Work center 
C) Manufacturing cell 
D) Assembly line 
E) Continuous process 
A) Product-process matrix 
B) Work center 
C) Manufacturing cell 
D) Assembly line 
E) Continuous process

Exam 7: Manufacturing Processes

A make-to-order firm will work with the customer to design the product and then make it from purchased materials, parts, and components.

Assume a fixed cost for a process of $100,000.The variable cost to produce each unit of product is $10, and the selling price for the finished product is $50.Ignoring inventory, how many units must the firm sell to break even? ______________________

Process selection refers to the strategic decision of choosing the volume of output to produce in a manufacturing facility depending upon the way that facility produces.

The placement of which of the following is not determined by production process organization decisions?

A project layout is characterized by a high degree of task ordering.

Work-center layouts allocate dissimilar machines into cells to work on products that have dissimilar processing requirements.

Assume a fixed cost for a process of $120,000.The variable cost to produce each unit of product is $35, and the selling price for the finished product is $50.Which of the following is the number of units that has to be produced and sold to break even?

Engineer-to-order firms will work with the customer to design the product and then make it from purchased materials, parts, and components.

The essential issue in satisfying customers in the make-to-stock environment is to balance the cost of the finished item against the willingness of the consumer to pay for it.

A high-level map or diagram of a supply chain process can be useful to understand how material flows and where inventory is held.

Which of the following basic types of process structures is one in which equipment or work processes are arranged according to the progressive steps by which the product is made?

Break-even analysis can only be used in production equipment decision making when dealing solely with fixed costs, not variable costs.

The term "assembly line" refers to progressive assembly linked by some material handling device.

One difference between an assembly line process flow and a continuous process flow is that on the assembly line the flow is discrete rather than continuous.

The focus in the make-to-stock environment is on providing finished goods where and when the customers want them.

A general-purpose machine is less capable than a special-purpose machine in certain tasks but can perform a broader variety of tasks.

Which of the following is not considered a major work flow structure?

Describe the implications of the product-process matrix for process design in a competitive situation.

Which of the following is not a basic type of process structure?

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