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Exam 12: Cost Management for Just-In-Time Environments

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Question 31

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Schedule of Activity Costs

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From the above schedule, calcu...

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Question 32

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Which of the following statements is correct?

A) Costs of controlling quality include prevention and appraisal costs.
B) Costs of failing to control quality include internal and external failure costs.
C) A and B are both correct.
D) A and B are both incorrect.

E) C) and D)
F) B) and C)

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Question 33

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Which of the following is not an external failure cost?

Sifton 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 just-in-time cell for each customer. The following information relates only to one customer's just-in-time cell for the coming year. Projected labor and overhead, $7,370,000; materials costs, $28 per unit. Planned production included 4,000 hours to produce 27,500 motor drives. Actual production for August was 1,600 units, and motor drives shipped amounted to 1,380 units. From the foregoing information, determine the production costs transferred to Cost of Goods Sold during August.

In a just-in-time (JIT) environment, process problems are more visible than they are in a traditional environment.

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

Schedule of Activity Costs

It is easier to quantify costs of controlling quality than the costs of failing to control quality.

Accounting for just-in-time operations requires fewer transactions because

Lead time reduction can be a cost-saving goal for any processed item.

Christmas Express makes wreaths in batch sizes of 12. The cutting & assembly process takes 7 minutes per wreath and the decorating process time is 10 minutes per wreath. It takes 12 minutes to move the wreaths from the cutting & assembly process to the decorating process. (a) Compute the value-added, non-value-added, and the total lead time of the wreath process. (b) Compute the value-added ratio. Round to the nearest decimal.

Schedule of Activity Costs

What do just-in-time (JIT) manufacturers demand from their vendors?

How are the objectives of just-in-time (JIT) manufacturing achieved?

Just-in-Time (JIT) manufacturing is also called make-to-order manufacturing.

Financial accounting information is used more often for long-term operating decisions and non-financial information is used more often for day-to-day decisions.

Employee involvement in a product-oriented factory emphasizes employee teams, rather than individual employees.

In a pull manufacturing system, raw materials are released to production based on actual customer orders.

Which of the following is best suited to providing timely and focused performance information?

A setup is the time required to prepare an operation for a new production run.