Deck 10: The Production Business Process

Question 1

Systems that incorporate programmable production processes that can be quickly reconfigured to produce different types of products are called ZIPS.

Answer 1

False

Question 2

Reorder point is calculated as the purchasing cost per order multiplied by the average inventory usage rate.

Answer 2

False

Question 3

Costs in job or processing costing may be either actual or standard costs.

Answer 3

True

Question 4

The central feature of the cost accounting application is updating of the production-loading file.

Question 5

A finished goods status report is sent to production planning from the stores department.

Question 6

An important internal control function is the reconciliation of time cards to production labor reports.

Question 7

The "heart" of the MRP II system is the MRP system.

Question 8

Automated drafting software is part of a CAM system.

Question 9

Industrial robots are used to move material,parts,tools,or specialized devices through variable programmed motions for the performance of a variety of tasks.

Question 10

Fixed assets are often the company's largest investment.

Question 11

Detailed material specifications for a product are recorded on a bill-of-materials.

Question 12

The perpetual inventory method is a term used to describe a system in which parts are produced only as they are required in subsequent operations.

Question 13

CAM systems are used to collect and process data from programmable manufacturing processes to provide decision support.

Question 14

The value of a typical EDI system is that vendor and customer are linked electronically.

Question 15

Sales forecasts are generally unrelated to the amount of a product held in inventory.

Question 16

The master-operations file is one of the data sources integrated with others in the production-planning application program.

Question 17

Bar code is an automatic identification technology that uses low power radio waves to send and receive data between RFID tags and readers.

Question 18

FMS greatly speeds up time-consuming retooling.

Question 19

The best sources of information necessary to calculate an EOQ are prior purchase orders.

Question 20

Factor availability reports communicate the availability of labor and machine resources for use in production.

Question 21

EAN-13 is a bar coding standard which is a superset of the original 12-digit UPC system.

Question 22

Lean production is a production system in which parts are produced only as they are required in subsequent operations.

Question 23

Production volume is one way to measure a cost driver.

Question 24

RFID tagging is more popular than bar coding in inventory management systems because they are cheaper and have a lower error rate.

Question 25

Radio-frequency identification is an automatic identification technology that uses low power radio waves to send and receive data between RFID tags and readers.

Question 26

Outputs of a cost accounting program are job time and machine time tickets.

Question 27

RFID stands for radio-frequency inventory documentation.

Question 28

The term applied overhead refers to the element of direct labor hours or cost used in the CIM environment.

Question 29

Activity-based costing calculates a single overhead rate for each different manufacturing activity.

Question 30

As a manufacturer moves from a batch to at JIT continuous flow manufacturing environment,more emphasis may be placed on an MRP II system.

Question 31

A GTIN can be 8-14 digits long and can be constructed using several number structures.

Question 32

The MRP II systems extends MRP in production order processing by including the creation of transaction files and numerical control tapes for the plant floor.

Question 33

The significance of activity-based costing as a management tools depends largely on the accuracy of the cost drivers selected as allocation bases.

Question 34

Lean production is an inventory system in which parts are stored when there is evidence of a stock out.

Question 35

GS1 is a global organization dedicated to the design and implementation of global standards and which is the creator of EAN-13.

Question 36

In MRP II,batch size is determined from the production-planning module.

Question 37

There are seven major processing modules in MRP II.

Question 38

The cost accounting application program processes the production data and production-status files.

Question 39

GTIN is the Global Trade Item Number which is an identifier for trade items developed by GS1.

Question 40

Lean production is a concept based on the concept that inventory is a waste.

Question 41

There are ________ major elements that enter into the cost of manufacturing a product.

Question 42

CIM significantly alters a manufacturer's cost behavior patterns by substituting ________ ________ for direct labor.

Question 43

In contrast to a(n)________ environment,there is no advance scheduling in a(n)________ environment.

Question 44

A production system in which parts are produced only as they are required in a subsequent operation is known as

A) periodic production.
B) green production.
C) lean production.
D) push production.

Question 45

In MRP II,the production ________ control module is used to implement the production plan and to reduce delays and waiting time by monitoring feedback and production and shop floor status data.

Question 46

In the production-planning application system,________ contain information about the work center,length of time,and tooling required to perform each task.

Question 47

________ ________ is a concept based on the idea that inventory is a waste.

Question 48

________ ________ in RFID eliminate the need for direct line of sight to the RFID tag.

Question 49

A document that details the resources available in stock for use in production is the ________ ________ report.

Question 50

To assist in the overall production-control function,________ ________ reports are distributed to department supervisors.

Question 51

An element that influences the total cost of an activity is a(n)________ ________.

Question 52

________ ________ scanners require a direct line of sight in order to function.

Question 53

A document detailing the work completed on individual orders as they move through the manufacturing process is the ________ ________ report.

Question 54

The ________ in MRP is used comprehensively to include all types of inventories.

Question 55

An out-of-stock condition may occur if the ________ ________ is not known for a particular inventory item.

Question 56

Systems that include software for defining the manufacturing process or tools to increase productivity are known as ________ systems.

Question 57

GTIN is an identifier used to look up product information in a(n)________ like UPCs.

Question 58

Systems ________ is "mission critical" in quick response manufacturing systems.

Question 59

EAN-13 is a(n)________ coding standard which is a superset of the original 12-digit UPC system.

Question 60

The procedure in which costs are compiled in process or department accounts by periods is called ________ costing.

Question 61

Calculation of the reorder point requires knowledge of

A) the economic order quantity multiplied by the average usage rate.
B) the time from the issuance of a purchase order until the order is received.
C) the average time from the issuance of a purchase order until the economic order quantity occurs.
D) the minimum inventory usage rate.

Question 62

The document used by the cost accounting function to establish a WIP record for each job is the

A) sales forecast.
B) production order.
C) materials requisition.
D) job time card.

Question 63

GTIN is an identifier used to look up product information in

A) GS1 tables.
B) Web-based list structures.
C) databases.
D) eBXML.

Question 64

Which is the best way for a company to prevent having outdated inventory on hand?

A) Store inventory securely
B) Classify inventory according to location in the company's records
C) Evaluate inventory turnover
D) Write down the inventory balance when a warehouse employee finds outdated inventory

Question 65

GTIN stands for

A) Global Trade Item Number.
B) Global Tracking Item Number.
C) Global Tracking Identifying Number.
D) Global Trade Identifying Number.

Question 66

The general formula for calculating the inventory reorder point is

A) average inventory usage rate multiplied by lead time.
B) economic order quantity less average inventory usage rate.
C) lead time multiplied by economic order quantity.
D) lead time multiplied by average inventory turnover rate.

Question 67

Control over inventory includes

A) storing.
B) handling.
C) spoilage.
D) Answer A and B are correct.

Question 68

Which of the following is not a concern regarding the storage and handling of inventory items?

A) Price paid per unit
B) Protection against damage or spoilage
C) Avoidance of obsolescence
D) Security against embezzlement

Question 69

Radio-frequency identification is an automatic identification technology that uses

A) high frequency radio waves to send and receive data between RFID tags and readers.
B) low power radio waves to send and receive data between RFID tags and readers.
C) bar codes to eliminate the need for direct line of sight to the RFID tags.
D) radio waves to send and receive data between bar coded tags.

Question 70

Which of the following controls is not a typical function found in the production business process of manufacturing firms?

A) Cost accounting
B) Production control
C) Property accounting
D) Capital expenditure review and authorization

Question 71

The document which specifies detailed labor operations,their sequencing,and their related machine requirements is

A) the bill of materials.
B) the master operations list.
C) either the bill of materials or master operations list.
D) the product specification and design abstract.

Question 72

The department that receives copies of materials requisitions from both the inventory control function and the production department is

A) accounting.
B) sales.
C) accounts payable.
D) purchasing.

Question 73

Which inventory control is the most critical in the production business process?

A) Separation of functions
B) Maintaining basic records and documentation
C) Periodic physical counts and tests against independent records
D) All of these controls are critical to inventory control in the production business process.

Question 74

________ is a bar coding standard which is a superset of the original 12-digit UPC system.

A) RFID-12
B) GS1-12
C) GTIN-13
D) EAN-13

Question 75

The following are reasons RFID tags are not widely used except

A) RFID is more costly that printed bar codes.
B) there is a much higher error rate in RFID than in scanning printed bar codes.
C) RFID cannot be used in lean manufacturing.
D) All of the above are reasons RFID tags are not widely used.

Question 76

A manufacturing company wants to know the optimal amount to order of part number 45612.It should gather appropriate inventory information about the part and then calculate the part's

A) inventory usage rate.
B) lead time.
C) economic order quantity.
D) reorder point.

Question 77

Which document is not updated when a manufacturing order is complete and goods are transferred to stores?

A) Production order
B) WIP record
C) Finished goods inventory records
D) Materials requisition

Question 78

The document which gives authorization to the production department to manufacture a product is a

A) production order.
B) materials requisition.
C) purchase order.
D) sales forecast.

Question 79

Several factors are integrated when determining what products should be manufactured.The factor which is predominantly driven by influences external to the production business process is

A) product requirements.
B) demand for the product.
C) production resources available to the firm.
D) Answers A and C are correct.

Question 80

The source for the item and quantity information shown on a materials requisition is the

A) bill of lading.
B) bill of materials.
C) inventory status report.
D) factor availability report.