Question 1

Which of the following is an example of internal failure costs?

Accepted Answer

A) Warranty repairs 
B) Reinspection / retesting 
C) machine inspection 
D) Inspection of incoming materials 
A) Warranty repairs 
B) Reinspection / retesting 
C) machine inspection 
D) Inspection of incoming materials

Question 2

Which of the following is not one of the factors that companies using JIT find essential for JIT to work?

Accepted Answer

A) short customer-response times. 
B) backlog of orders. 
C) economic-order quantities for inventory. 
D) reliable suppliers. 
A) short customer-response times. 
B) backlog of orders. 
C) economic-order quantities for inventory. 
D) reliable suppliers.

Question 3

The performance evaluation tools that assist in evaluating performance by integrating financial and nonfinancial measures include which of the following?

Accepted Answer

A) PERT chart and balanced scorecard. 
B) balanced scorecard and Pareto chart. 
C) Pareto chart and control chart. 
D) balanced scorecard. 
A) PERT chart and balanced scorecard. 
B) balanced scorecard and Pareto chart. 
C) Pareto chart and control chart. 
D) balanced scorecard.

Question 4

Significant differences between the "traditional view" of quality and the emerging "quality-based view" relate to which of the following?

Accepted Answer

A) quality production,inspections,causes of defects,standards,purchasing,and customer focus. 
B) financial,internal business process,learning and growth,customer. 
C) total quality,smooth production flow,purchasing quality materials,well trained and flexible workforce,short customer-response times,backlog of orders. 
D) prevention costs,appraisal costs,internal failure costs,and external failure costs. 
A) quality production,inspections,causes of defects,standards,purchasing,and customer focus. 
B) financial,internal business process,learning and growth,customer. 
C) total quality,smooth production flow,purchasing quality materials,well trained and flexible workforce,short customer-response times,backlog of orders. 
D) prevention costs,appraisal costs,internal failure costs,and external failure costs.

Question 5

To support total quality management,firms should base rewards more on which measures of performance?

Accepted Answer

A) Efficiency and effectiveness 
B) Economy and efficiency 
C) Productivity and effectiveness 
D) Quality and customer satisfaction 
A) Efficiency and effectiveness 
B) Economy and efficiency 
C) Productivity and effectiveness 
D) Quality and customer satisfaction

Question 6

Which statement is true concerning internal failure costs?

Accepted Answer

A) Internal failure costs are incurred to prevent defects in the products or services being produced. 
B) Internal failure costs are incurred to detect individual units of products that do not conform to specifications. 
C) Internal failure costs are incurred when the firm discovers nonconforming products and services before delivery to customers. 
D) Internal failure costs are incurred when the customers discover nonconforming products and services at delivery. 
A) Internal failure costs are incurred to prevent defects in the products or services being produced. 
B) Internal failure costs are incurred to detect individual units of products that do not conform to specifications. 
C) Internal failure costs are incurred when the firm discovers nonconforming products and services before delivery to customers. 
D) Internal failure costs are incurred when the customers discover nonconforming products and services at delivery.

Question 7

Which of the following is a cost incurred when customers discover nonconforming products and services at delivery?

Accepted Answer

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

Question 8

Which of the following is the performance evaluation tool that measures performance by integrating financial measures,internal business process measures,learning and growth measures,and customer measures?

Accepted Answer

A) PERT chart. 
B) balanced scorecard. 
C) Pareto chart. 
D) control chart. 
A) PERT chart. 
B) balanced scorecard. 
C) Pareto chart. 
D) control chart.

Question 9

Which of the following statements is true concerning the critical success factors dealing with service?

Accepted Answer

A) Service means giving the customer what the firm promised;it is the degree to which the customer is satisfied. 
B) Service is the price of a product which must cover its costs or the organization will no longer make the product. 
C) Service can be described as the expectations the customer has about all aspects,both tangible and intangible,of the product's purchase and use. 
D) None of the answers is correct. 
A) Service means giving the customer what the firm promised;it is the degree to which the customer is satisfied. 
B) Service is the price of a product which must cover its costs or the organization will no longer make the product. 
C) Service can be described as the expectations the customer has about all aspects,both tangible and intangible,of the product's purchase and use. 
D) None of the answers is correct.

Question 10

When is the appropriate time to purchase or produce goods and services in a just-in-time (JIT)environment?

Accepted Answer

A) when the available inventory equals the economic ordering quantity. 
B) when the inventory equals one-half of the next months requirements. 
C) when the inventory equals the next months requirements. 
D) when the company needs them. 
A) when the available inventory equals the economic ordering quantity. 
B) when the inventory equals one-half of the next months requirements. 
C) when the inventory equals the next months requirements. 
D) when the company needs them.

Question 11

Assume Fruit Delight Beverages has discovered a problem involving the mix of flavor to their seltzer water that costs the company $4,000 in waste and $2,800 in lost business per period.There are two alternative solutions.The first is to lease a new mix regulator at a cost of $4,000 per period.The new regulator would save Fruit Delight Beverages $2,000 in waste and $2,000 in lost business each period.The second alternative is to hire an additional employee to manually monitor the existing regulator at a cost of $2,900 per period.This would save Fruit Delight Beverages $1,400 in waste and $800 in lost business per period.
Required:
Which alternative should Fruit Delight Beverages choose?
(Fruit Delight Beverages;Quality versus costs. )

Accepted Answer

@#IMG-DLM&_TB2144_00 Fruit Delight Beverages is in

Question 12

At Bingham Dry Goods,the strategy for success requires rapid growth with a limited number of units for each design of product in order to enhance is promise of exclusivity,perfect fit,on-time delivery to customers,retaining good employees with innovative ideas,and control of inventory.
Required:
Based on this,suggest one performance measure for each dimension of a balanced scorecard for Bingham.

Accepted Answer

Answers may vary but here are examples:

Question 13

Response time improvements often drive simultaneous improvements in

Accepted Answer

A) economy and efficiency. 
B) economy and effectiveness. 
C) quality and productivity. 
D) quantity and efficiency. 
A) economy and efficiency. 
B) economy and effectiveness. 
C) quality and productivity. 
D) quantity and efficiency.

Question 14

Which of the following is not one of the factors that companies using JIT find essential for JIT to work?

Accepted Answer

A) total quality - all employees must be involved in quality. 
B) smooth production flow - fluctuations in production lead to delays. 
C) purchasing quality materials - defective materials disrupt the production flow. 
D) specialized,inflexible workforce - workers are unique specialized experts. 
A) total quality - all employees must be involved in quality. 
B) smooth production flow - fluctuations in production lead to delays. 
C) purchasing quality materials - defective materials disrupt the production flow. 
D) specialized,inflexible workforce - workers are unique specialized experts.

Question 15

Activity-based management can reduce customer response time by

Accepted Answer

A) identifying the activities that consume the most resources. 
B) making the activities more efficient. 
C) identifying non-value-added activities which the firm can eliminate. 
D) All of the answers are correct. 
A) identifying the activities that consume the most resources. 
B) making the activities more efficient. 
C) identifying non-value-added activities which the firm can eliminate. 
D) All of the answers are correct.

Question 16

Total quality costs include
Prevention Carrying Appraisal

Accepted Answer

A) Yes Yes Yes 
B) No No Yes 
C) Yes No No 
D) Yes No Yes 
A) Yes Yes Yes 
B) No No Yes 
C) Yes No No 
D) Yes No Yes

Question 17

Which of the following statements is correct concerning break-even time?

Accepted Answer

A) Break-even time is the length of time required to recover the investment made in new-product development. 
B) Break-even time begins when management approves a project,rather than when cash out-flows first occur. 
C) Break-even time considers the time value of money by discounting all cash flows. 
D) All of the answers are correct. 
A) Break-even time is the length of time required to recover the investment made in new-product development. 
B) Break-even time begins when management approves a project,rather than when cash out-flows first occur. 
C) Break-even time considers the time value of money by discounting all cash flows. 
D) All of the answers are correct.

Question 18

Activity-based management reduces customer response time by identifying the activities that consume the most resources and making them more efficient,and by identifying __________ activities,which the firm can eliminate.

Accepted Answer

A) value-added 
B) non-value-added 
C) inefficient 
D) ineffective 
A) value-added 
B) non-value-added 
C) inefficient 
D) ineffective

Question 19

Three Dog Bite Company:
 
Refer to Three Dog Bite Company.What are the total external failure costs?

Accepted Answer

A) $ 600,000 
B) $ 900,000 
C) $ 370,000 
D) $1,220,000 
A) $ 600,000 
B) $ 900,000 
C) $ 370,000 
D) $1,220,000

Question 20

Which critical success factor means giving the customer what the firm promised;it is the degree to which the customer is satisfied?

Accepted Answer

A) Service 
B) Quality 
C) Quantity 
D) Cost 
A) Service 
B) Quality 
C) Quantity 
D) Cost

Which of the following is an example of internal failure costs?

Which of the following is not one of the factors that companies using JIT find essential for JIT to work?

The performance evaluation tools that assist in evaluating performance by integrating financial and nonfinancial measures include which of the following?

Significant differences between the "traditional view" of quality and the emerging "quality-based view" relate to which of the following?

To support total quality management,firms should base rewards more on which measures of performance?

Which statement is true concerning internal failure costs?

Which of the following is a cost incurred when customers discover nonconforming products and services at delivery?

Which of the following is the performance evaluation tool that measures performance by integrating financial measures,internal business process measures,learning and growth measures,and customer measures?

Which of the following statements is true concerning the critical success factors dealing with service?

When is the appropriate time to purchase or produce goods and services in a just-in-time (JIT)environment?

Response time improvements often drive simultaneous improvements in

Which of the following is not one of the factors that companies using JIT find essential for JIT to work?

Activity-based management can reduce customer response time by

Total quality costs include Prevention Carrying Appraisal

Which of the following statements is correct concerning break-even time?

Activity-based management reduces customer response time by identifying the activities that consume the most resources and making them more efficient,and by identifying __________ activities,which the firm can eliminate.

Three Dog Bite Company: Refer to Three Dog Bite Company.What are the total external failure costs?

Which critical success factor means giving the customer what the firm promised;it is the degree to which the customer is satisfied?

Fundamental Concepts

Measuring Product Costs

Activity-Based Management

Cost Drivers and Cost Behavior

Financial Modeling for Short-Term Decision Making

Differential Cost Analysis for Operating Decisions

Capital Expenditure Decisions

Profit Planning and Budgeting

Profit and Cost Center Performance Evaluation

Investment Center Performance Evaluation

Incentive Issues

Allocating Costs to Responsibility Centers

Filters

Exam 4: Strategic Management of Costs,quality,and Time

Which of the following is an example of internal failure costs?

Which of the following is not one of the factors that companies using JIT find essential for JIT to work?

The performance evaluation tools that assist in evaluating performance by integrating financial and nonfinancial measures include which of the following?

Significant differences between the "traditional view" of quality and the emerging "quality-based view" relate to which of the following?

To support total quality management,firms should base rewards more on which measures of performance?

Which statement is true concerning internal failure costs?

Which of the following is a cost incurred when customers discover nonconforming products and services at delivery?

Which of the following is the performance evaluation tool that measures performance by integrating financial measures,internal business process measures,learning and growth measures,and customer measures?

Which of the following statements is true concerning the critical success factors dealing with service?

When is the appropriate time to purchase or produce goods and services in a just-in-time (JIT)environment?

Response time improvements often drive simultaneous improvements in

Which of the following is not one of the factors that companies using JIT find essential for JIT to work?

Activity-based management can reduce customer response time by

Total quality costs include Prevention Carrying Appraisal

Which of the following statements is correct concerning break-even time?

Activity-based management reduces customer response time by identifying the activities that consume the most resources and making them more efficient,and by identifying __________ activities,which the firm can eliminate.

Three Dog Bite Company: Refer to Three Dog Bite Company.What are the total external failure costs?

Which critical success factor means giving the customer what the firm promised;it is the degree to which the customer is satisfied?

Fundamental Concepts

Measuring Product Costs

Activity-Based Management

Cost Drivers and Cost Behavior

Financial Modeling for Short-Term Decision Making

Differential Cost Analysis for Operating Decisions

Capital Expenditure Decisions

Profit Planning and Budgeting

Profit and Cost Center Performance Evaluation

Investment Center Performance Evaluation

Incentive Issues

Allocating Costs to Responsibility Centers

Filters