Deck 17: Implementing Quality Concepts

Question 1

Process benchmarking creates the risk for a company to become stagnant.

Answer 1

False

Question 2

Grade refers to a product meeting the highest number of a customer's needs at the lowest possible cost.

Answer 2

False

Question 3

A total quality system should place an emphasis on inspection.

Answer 3

False

Question 4

Testing and adjusting manufacturing equipment is a prevention cost.

Question 5

Inspection of incoming inventory is a value-adding activity.

Question 6

Reworking a product is an appraisal cost.

Question 7

When implementing TQM, an organization should establish long-term relationships with preferred suppliers.

Question 8

Process benchmarking is concerned with how top-ranked companies achieve their results.

Question 9

Testing and adjusting manufacturing equipment is an appraisal cost.

Question 10

Strategic benchmarking is industry specific in its approach.

Question 11

Quality control places the primary responsibility for product or service quality on the provider.

Question 12

When implementing TQM, an organization should establish long-term relationships with as many suppliers as possible.

Question 13

Total quality management requires that an organization analyze the costs and benefits of each of its customer segments.

Question 14

Value refers to a product meeting the highest number of a customer's needs at the lowest possible cost.

Question 15

Storage of unneeded inventory is a non-value added item.

Question 16

Grade refers to one of many quality levels that a product or service has relative to the inclusion or exclusion of certain characteristics to satisfy customer needs.

Question 17

Productivity is measured by the quantity of good output generated from a specific amount of input during a time period.

Question 18

A total quality system should place an emphasis on prevention and continuous improvement.

Question 19

Reworking a product is an internal failure cost.

Question 20

Results benchmarking creates the risk for a company to become stagnant.

Question 21

The balanced scorecard can be used to provide information on quality in an organization.

Question 22

The two costs of noncompliance are ___________________________________ and ___________________________________.

Question 23

The quantity of good output generated from a specific of output during a time period is referred to as ____________________.

Question 24

Costs of monitoring and compensating for mistakes not eliminated through prevention activities are referred to as ______________________________.

Question 25

Total quality management (TQM) requires the commitment of all individuals within an organization.

Question 26

An all-inclusive definition of quality views it as the ability of products/services to

A) only meet internal design specifications.
B) meet the customer's stated or implied needs.
C) be produced using all value-added production activities.
D) be produced with no rework costs.

Question 27

Costs that preclude product defects resulting from flaws in processing are referred to as ______________________________.

Question 28

Costs incurred to correct defects in products prior to shipment are referred to as ________________________________________.

Question 29

Costs incurred to correct defects in products after shipment are referred to as ________________________________________.

Question 30

A benchmarking process that is non-industry specific and focuses on how companies compete is referred to as ___________________________________.

Question 31

Pareto analysis is frequently used to aid management in deciding where to concentrate quality prevention cost dollars.

Question 32

Replacing a product after it has been sold is an external failure cost.

Question 33

A process in which an end product or service is examined using reverse engineering is referred to as ___________________________________.

Question 34

ISO 9000 registration is required for regulated products sold in the European Union.

Question 35

ISO 9000 registration is required for regulated products sold in the United States.

Question 36

The two costs of compliance are ______________________________ and ______________________________.

Question 37

Conducting a quality audit is a prevention cost.

Question 38

A benchmarking process that focuses on how best-in-class companies achieve their results is referred to as ___________________________________.

Question 39

The process of investigating, comparing, and evaluating a company's products or services against those of other companies is referred to as ____________________.

Question 40

Conducting a quality audit is an appraisal cost.

Question 41

All attempts to reduce variability and defects in products reflect the implementation of

A) activity analysis.
B) statistical process control.
C) quality control.
D) control charts.

Question 42

Which of the following is false as it relates to quality?

A) Quality is the total of all characteristics of a product or service that impacts on its ability to meet the needs of a specific person.
B) Quality must always be viewed from the user's perspective.
C) Quality is never concerned with what the user thinks, feels, or deems important.
D) The definition of quality has evolved through time and is more currently comprehensive than in the past.

Question 43

Value reflects the ability of a product to

A) provide the best quality at any price.
B) have all possible product and service characteristics.
C) meet the majority of a customer's needs at the lowest possible price.
D) have the longest technical or service life and the best warranty.

Question 44

Comparing the way a "best-in-class" company performs a specific activity (such as distribution) is called

A) process benchmarking.
B) results benchmarking.
C) total quality management benchmarking.
D) SPC benchmarking.

Question 45

Benchmarking against direct competitors creates the risk of

A) creating products or services with identical specifications.
B) becoming stagnant relative to process improvements.
C) being taken over by the competitors to prevent a loss of ideas.
D) all of the above.

Question 46

Benchmarking

A) yes no
B) no yes
C) yes yes
D) no no

Question 47

Benchmarking allows a company to

A) identify its strengths and weaknesses.
B) imitate those ideas that are readily transferable.
C) improve on methods in use by others.
D) all of the above.

Question 48

A control chart graphs

A) actual process results relative to a range of acceptable variation.
B) expected process results relative to upper and lower control limits.
C) actual process results relative to value-added and non-value-added activities.
D) the cost of process malfunctions relative to the cost of reducing process variations.

Question 49

The addition or removal of product or service characteristics to satisfy additional needs, especially price, reflect the ____ of a product or service.

A) value
B) grade
C) quality
D) durability

Question 50

Productivity is measured by the

A) total quantity of output generated from a limited amount of input during a time period.
B) quantity of good output generated from a specific amount of input during a time period.
C) quantity of good output generated from the quantity of good input used during a time period.
D) total quantity of input used to generate total quantity of output for a time period.

Question 51

Reverse engineering is used in

A) statistical process control.
B) process benchmarking.
C) results benchmarking.
D) price fixing.

Question 52

Which of the following is not a critical element in a total quality management system?

A) employee involvement
B) activity-based costing
C) continuous improvement
D) problem prevention emphasis

Question 53

Control charts are appropriate devices in

A) total quality control.
B) statistical process control.
C) total quality management.
D) all of the above.

Question 54

Which of the following is not a step in benchmarking procedures?

A) analyze the "positive gap"
B) engage in continuous improvement
C) analyze the "negative gap"
D) identify "best-in-class" companies

Question 55

____ places the primary responsibility for quality on the maker or producer.

A) Pareto analysis
B) Quality control
C) Benchmarking
D) Activity analysis

Question 56

Benchmarking does which of the following activities relative to a "best-in-class" (BIC) company?

A) yes yes yes
B) yes no no
C) no no yes
D) yes no yes

Question 57

Which of the following can be used to indicate factors that slow down or cause unnecessary work in a process?

A) activity analysis
B) total quality management
C) cost of quality
D) all of the above

Question 58

Which of the following are undesirable from a consumer perspective but are frequently needed?

A) value-neutral activities
B) value-added activities
C) non-value-added activities
D) none of the above

Question 59

Which of the following would typically be viewed as non-value-added activities?

A) yes yes yes no
B) no no no yes
C) no yes no yes
D) yes yes no yes

Question 60

Benchmarking against noncompetitors is extremely important in

A) process benchmarking.
B) results benchmarking.
C) reverse engineering.
D) all of the above.

Question 61

The most visible embodiment of total quality management in the United States is

A) being awarded the Deming Prize.
B) achieving ISO 9000 certification.
C) meeting industry standards.
D) receiving the Baldrige Award.

Question 62

A total quality system should be designed to promote a reorientation of thinking from an emphasis on

A) internal quality improvements to an emphasis on external benchmarking.
B) the planning process to an emphasis on the performance evaluation process.
C) inspection to an emphasis on prevention.
D) process benchmarking to an emphasis on results benchmarking.

Question 63

The number of product defects discovered by consumers is what kind of performance indicator?

A) yes no no yes
B) no yes no yes
C) no yes yes no
D) yes no no yes

Question 64

A significant cost of quality that is not recorded in the accounting records is the

A) failure cost for a customer complaint center.
B) cost of reworking products to bring them up to specification.
C) opportunity costs of forgone future sales.
D) appraisal cost for product equipment.

Question 65

A cost of quality report compares current period quality costs in specified categories to

A) last year's quality costs.
B) current period budgeted quality costs.
C) total quality costs for the period.
D) both a and b.

Question 66

Compliance costs include

A) yes no no
B) no yes yes
C) yes yes no
D) yes yes yes

Question 67

Total quality management is inseparable from the concept of

A) ISO certification.
B) centralized organizational structure.
C) continuous improvement.
D) the product life cycle.

Question 68

Recalls are fairly common events for automobile manufacturers. The costs of recalling and repairing a car create

A) yes yes no
B) yes yes yes
C) no yes no
D) yes no yes

Question 69

Mistakes not eliminated by prevention costs may cause

A) no no
B) no yes
C) yes no
D) yes yes

Question 70

Product quality includes all of the following except

A) appeal.
B) performance.
C) durability.
D) price.

Question 71

Which of the following is the first element of knowledge needed by a company wanting to pursue total quality management?

A) what the company's customers want
B) who the company's customers are
C) how the company's processes are designed
D) what the components of the company's product are

Question 72

Production quality is affected by

A) worker productivity.
B) the amount of failure costs incurred.
C) worker skill level.
D) just-in-time suppliers.

Question 73

Which of the following statements is true?

A) The more customers a company has, the better off the company is.
B) A company should spare no expense to provide customer satisfaction.
C) Most customers stop doing business with a company because of poor product or service quality.
D) Cost-benefit analysis can help identify customers that cost more than they are worth to the company.

Question 74

An appraisal cost is created by

A) installing automated technology.
B) reworking products.
C) verifying procedures.
D) rescheduling and setup.

Question 75

Which of the following are categories judged for the Baldrige Award?

A) no yes no yes yes
B) yes yes yes yes yes
C) yes yes no yes no
D) no no no no no

Question 76

Money spent on employee training is a

A) prevention cost.
B) appraisal cost.
C) empowerment cost.
D) Pareto cost.

Question 77

The four categories of product quality costs are

A) external failure, internal failure, prevention, and carrying.
B) external failure, internal failure, prevention, and appraisal.
C) external failure, internal failure, training, and appraisal.
D) warranty, product liability, training, and appraisal.

Question 78

Management can decide where to concentrate its quality prevention dollars using

A) statistical process control charts.
B) just-in-time inventory systems.
C) a feedback loop.
D) Pareto analysis.

Question 79

A company will not achieve world-class status unless a quality focus

A) allows that company to achieve one or more major quality awards.
B) becomes an integral part of the organization's culture.
C) emphasizes the elimination of all quality costs for compliance and noncompliance.
D) has been mandated by management for workers to pursue.

Question 80

Historically, the cost of quality has been

A) included in account balances for items such as Work in Process Inventory and marketing expenses.
B) detailed in various "cost of quality" account balances on the Income Statement.
C) immaterial because no accounts were developed to detail these amounts.
D) generally spent in the prevention rather than the appraisal category.