Accounting Information Systems, 8e—Test Bank, Chapter 7
39. Which of the following is not a principle of lean manufacturing?
a.
Products are pushed from the production end to the customer
b.
All activities that do not add value and maximize the use of scarce resources must
be eliminated
c.
Achieve high inventory turnover rate.
d.
A lean manufacturing firm must have established and cooperative relationships
with vendors
e.
All of the above are lean manufacturing principles.
40. All of the following are problems with traditional accounting information except:
a.
Managers in a lean setting require immediate information.
b.
The measurement principle tends to ignore standards other than money.
c.
Standard costing motivates nonlean behavior in operations.
d.
The overhead component in a manufacturing company is usually very large.
e.
All of the above are problems associated with traditional accounting information.
SHORT ANSWER
1. Which type of manufacturing creates a homogeneous product through a continuous series of
standard procedures?
2. What information is contained in the bill of materials (BOM)?
3. What is the difference between a materials requisition and a purchase requisition?
4. List one authorization control in the traditional manufacturing environment.
5. Explain the conversion cycle.
6. What is one benefit of the flexible production system?
7. List two disadvantages of using a traditional cost accounting system.
8. In Activity Based Costing, what is the term used to refer to the work performed by a firm?
9. Discuss inventory control objectives.
10. Describe the primary goal of lean manufacturing?
11. What is meant by the term “islands of technology”?
12. In a traditional manufacturing environment, cost accounting provides independent verification
of what information? What are the benefits?
13. How are cost structures fundamentally different between the traditional and CIM
environments?
14. What are the key segregation of duties issues in the conversion cycle?
15. Traditional accounting assumes that products cause costs. ABC assumes that
_________________ cause costs.
16. Differentiate between essential and non-essential activities.
17. What is a company’s value stream?
18. What document signals the completion of the production process?
19. What document triggers the beginning of the cost accounting process for a given production
run?
20. Name five documents associated with batch production systems.
ESSAY
1. Itemize the disadvantages of ABC that have caused some firms to abandon this technique.
2. Contrast the treatment of inventories in the traditional manufacturing environment and the
lean manufacturing environment.
3. Discuss the key segregations of duties that should exist in the traditional manufacturing
environment.
4. Outline the characteristic of a world-class company.
5. How does automation help achieve manufacturing flexibility?
6. How does MRP II (manufacturing resource planning) expand on MRP (materials
requirements planning)?
7. Discuss the importance to the cost-accounting department of the move ticket.
8. Discuss the purpose and key features of a value stream map (VSM)?
9. Discuss the principles underlying the lean manufacturing approach.
10. Discuss three common problems associated with inventories.
11. Automation is at the heart of the lean manufacturing philosophy. Discuss its stages and its
distinguishing features.
12. How can a firm control against excessive quantities of raw materials being used in the
manufacturing process.
13. Explain the relationship between MRP, MRPII and ERP.
14. Explain how CAD can contribute to a firm’s move toward world-class status.
15. Explain how CAM can contribute to a firm’s move toward world-class status.
16. Explain why traditional cost allocation methods fail in a CIM environment.
17. What is meant by the term “product family” and what is its relationship to value stream
accounting.
Accounting Information Systems, 8e—Test Bank, Chapter 7