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Chapter 27(12): Lean Principles, Lean Accounting, and Activity Analysis
72.
Traditional manufacturing emphasizes all of the following except
a.
team oriented employee involvement
b.
process-oriented layout
c.
push manufacturing
d.
cost accumulation by department
73.
Which of the following is considered non-value-added lead time?
a.
packing
b.
moving from process to process
c.
converting raw materials to finished product
d.
all of the above
74.
Under a lean environment, employees have the responsibility and authority to
a.
purchase inventory.
b.
determine output amounts.
c.
make decisions about operations, rather than waiting for management.
d.
make engineering changes.
75.
Which of the following drives work-in-process inventory levels higher?
a.
Machine breakdowns
b.
Production rate losses
c.
Rework processes
d.
All of the above
76.
Which of the following is characteristic of a lean production layout?
a.
Decentralized maintenance and small production batches
b.
Decentralized maintenance and organization around processes
c.
Organization around processes and small production batches
d.
Large production batches and organization around processes.
77.
In a lean environment, process problems are more visible than they are in a traditional environment because:
a.
inventories are maintained at higher levels.
b.
process problems cause production to shut down immediately.
c.
the push manufacturing system leads to increased inventory level.
d.
the lack of work in process inventory creates problems.
78.
Examples of transforming a traditional manufacturing environment to a lean environment is to do all of the
following
except
a.
form partnerships with reliable suppliers.
b.
reorganize operational processes to organized product lines.
c.
train employees to perform various operations.
d.
increase raw materials to produce more, thereby increasing finished goods inventory.
79.
A college would like to increase enrollment by streamlining the enrollment process. Which of the following would
not fall in line with the college goal?
a.
Reduce the requirements necessary to enroll.
b.
Relocate counselors, academic advisors, and financial aid specialists for a major to a central location.
c.
Cross-train counselors, academic advisors, and financial aid specialists.
d.
All of these choices would fall in line with the college goal.
80.
A local college is aggressively working to reduce the time it takes students to enroll for each semester. Which
of
the following changes would not help achieve this goal?
a.
Counselors are specializing in common degree plans
b.
One application is good at the community college and at the transferring university
c.
A one stop area includes admissions, advising, registration and student ID’s
d.
Having more number of staff to help facilitate admission process
81.
Which of the following is characteristic of the lean system?
a.
Fewer work in process account transactions.
b.
Work in process and raw materials accounts combined.
c.
Elimination of the direct labor account.
d.
All of the above.
82.
Which of the following is characteristic of the traditional cost system?
a.
Many work in process account transactions.
b.
Reliance on financial performance measures.
c.
Many process control points.
d.
All of the above.
83.
Which of the following is an example of a nonfinancial measure?
a.
lead time
b.
setup time
c.
units scrapped
d.
all of the above
84.
Which of the following is best suited to providing timely and focused performance information?
a.
nonfinancial information
b.
financial accounting information
c.
cost accounting information
d.
variance analysis
85.
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. Raw and In Process Inventory
Accounts Payable
36,000
36,000
b. Cost of Goods Manufactured
Accounts Payable
36,000
36,000
c. Finished Goods
Accounts Payable
36,000
36,000
d. Raw Materials Inventory
Accounts Payable
36,000
36,000
86.
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 only to one customer's lean cell. For the year, planned labor and overhead was
$80,000,000; materials costs, $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 budgeted cell conversion cost per hour.
a. $8,025
b. $800
c. $7,200
d. $8,333
87.
Kilbuck Manufacturing operates in a lean manufacturing environment. Kilbuck’s actual conversion costs for the
month of May follow:
Direct and indirect labor
$150,000
Machine depreciation
85,000
Maintenance and supplies
60,000
Total conversion costs
$295,000
The journal entry to record May's conversion costs will include:
a.
a credit to Work in Process Inventory
b.
a debit to Raw Materials Inventory
c.
a credit to Raw and In Process Inventory
d.
a debit to Raw and In Process Inventory
Chapter 27(12): Lean Principles, Lean Accounting, and Activity Analysis
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 lean cell for each customer.
The following information relates only to one customer's lean 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.
88.
From the foregoing information, determine the budgeted cell conversion cost per unit.
a. $240.00
b. $268.00
c. $296.00
d. $1,842.50
89.
From the foregoing information, determine the manufacturing cost per unit.
a. $240.00
b. $268.00
c. $296.00
d. $1,870.50
90.
From the foregoing information, determine the amount of the conversion costs charged to Raw and In Process
Inventory during August.
a. $369,840
b. $408,480
c. $428,800
d. $473,600
91.
From the foregoing information, determine the production costs transferred to Finished Goods during August.
a. $369,840
b. $408,480
c. $428,800
d. $473,600
92.
From the foregoing information, determine the production costs transferred to Cost of Goods Sold during August.
‘
a. $369,840
b. $408,480
c. $428,800
d. $473,600
93.
Accounting for lean operations requires fewer transactions because
a.
large batches of inventory are combined in a smaller number of transactions.
b.
costs are accumulated in one department and then transferred to the next department.
c.
combined material and conversion costs are transferred to finished goods.
d.
costs are transferred from department to department allowing for better controls in costs.
94.
Which of the following results in fewer transactions in lean accounting?
a.
all manufacturing costs are combined in one account called Raw and In Process Inventory.
b.
the distinction between direct and indirect costs is eliminated.
c.
there is less movement of inventory between departments.
d.
All of the above.
95.
The budgeted cell conversion cost rate includes which of the following?
a.
only factory overhead
b.
only direct labor and direct materials
c.
direct labor, direct materials, and factory overhead
d.
only direct labor and factory overhead
Chapter 27(12): Lean Principles, Lean Accounting, and Activity Analysis
Schedule of Activity Costs
Quality Control Activities
Activity Cost
Process audits
$50,000
Training of machine operators
28,000
Processing returned products
19,000
Scrap processing (disposal)
25,000
Rework
8,000
Preventative maintenance
30,000
Product design
46,000
Warranty work
12,000
Finished goods inspection
23,000
96.
From the above schedule of activity costs, determine the total activity cost.
a. $62,000
b. $179,000
c. $94,000
d. $241,000
97.
From the above schedule of activity costs, determine the non-value-added costs.
a. $30,000
b. $50,000
c. $64,000
d. $85,000
98.
From the above schedule of activity costs, determine the value-added costs.
a. $177,000
b. $191,000
c. $156,000
d. $104,000
99.
From the above schedule of activity costs, determine the internal failure costs.
a. $37,000
b. $25,000
c. $8,000
d. $33,000
100.
From the above schedule of activity costs, determine the external failure costs.
a. $39,000
b. $19,000
c. $12,000
d. $31,000
101.
From the above schedule of activity costs, determine the appraisal costs.
a. $50,000
b. $23,000
c. $73,000
d. $104,000
102.
From the above schedule of activity costs, determine the prevention costs.
a. $30,000
b. $74,000
c. $76,000
d. $104,000
103.
Which of the following is not a prevention cost?
a.
preventive maintenance
b.
operator training
c.
design engineering
d.
testing finished products
