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Exam 27: Lean Manufacturing and Activity Analysis

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Question 71

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Schedule of Activity Costs ​ -From the provided schedule of activity costs, determine the value-added costs.

A) $177,000
B) $191,000
C) $156,000
D) $104,000

E) A) and B)
F) A) and C)

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Question 72

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Squirrel Co. operates in a lean manufacturing environment. For June production, Squirrel purchased 6,000 units of raw materials at $6.00 per unit on account. The journal entry required to record this transaction is

A)
B)
C)
D)

E) All of the above
F) A) and D)

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Question 73

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Schedule of Activity Costs ​ -From the provided schedule of activity costs, determine the prevention costs.

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

In a lean environment, operations only respond to customer orders.

Which of the following is related to long lead times?

In the lean principles philosophy, unexpected downtime is the result of unreliable processes.

Match each of the following activities with the appropriate quality cost classification (a-d). -Recalling defective products A)Prevention cost B)Appraisal cost C)Internal failure cost D)External failure cost

Long setups and large batch sizes result in smaller inventories and reduced lead times.

Match each of the following quality control activities with the appropriate classification (a or b). -Processing returned materials A)Value-added B)Non-value-added

A setup is the effort spent preparing an operation or process for production.

Push manufacturing is also referred to as "make to order" processing.

From the foregoing information, determine the production costs transferred to Finished Goods during August.

Conan 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 lean cell for each customer. The following information relates to only one customer's lean cell. For the year, planned labor and overhead was $80,000,000 and materials costs were $25 per unit. Planned production included 9,600 hours to produce 76,800 motor drives. Actual production for the month of August was 5,200 units, and motor drives shipped amounted to 5,040 units. From the foregoing information, determine the cell conversion cost rate for applying conversion costs.