Question 1

You are hired as a consultant to decide if your client should purchase a new,highly specialized,piece of equipment.The product to be produced by this equipment is forecast to have a total world wide demand of 15,000 units over the entire product life.The initial investment to acquire and install the equipment is $256,000.The variable cost to produce each unit will be $15 and the selling price for the finished product will be $30.Which of the following best describes the situation the firm is facing?
A)The company will recover its' initial investment
B)The company's total margin will be less than its' investment
C)It's a good investment
D)The break-even is lower than the 15,000 units that are expected to sell
E)All of the above

Accepted Answer

To determine the profitability of the investment, we need to calculate the total revenue and total cost over the entire product life.

Total revenue = Selling price x Total units sold
Total revenue = $30 x 15,000
Total revenue = $450,000

Total cost = Fixed cost + Variable cost
Fixed cost = initial investment = $256,000
Variable cost = $15 x 15,000 = $225,000
Total cost = $256,000 + $225,000
Total cost = $481,000

Total profit = Total revenue - Total cost
Total profit = $450,000 - $481,000
Total profit = -$31,000

Since the total profit is negative, it means that the company's total margin will be less than its investment. Therefore, the best choice is B. It is not a good investment as the company will not recover its initial investment. The break-even point is also irrelevant as the investment is not profitable.

Question 2

Which of the following is a basic type of process structure?
A)Process flow diagram
B)Product matrix
C)Process matrix
D)Workcenter
E)Manual assembly

Accepted Answer

The answer of Which of the following is a basic...

Question 3

Which of the following basic types of process structures is one which equipment or work processes are arranged according to the progressive steps by which the product is made?
A)Project
B)Workcenter
C)Manufacturing cell
D)Assembly line
E)Continuous process

Accepted Answer

The assembly line is a process structure where equipment and work processes are arranged according to the progressive steps by which the product is made. The product moves along a line, and each worker contributes to a specific step in the process.

Question 4

Which of the following is not a basic type of process structure?
A)Product-process matrix
B)Workcenter
C)Manufacturing cell
D)Assembly line
E)Continuous process

Accepted Answer

The product-process matrix is not a basic type of process structure but rather a tool used for analyzing and comparing different manufacturing processes based on their volume and flexibility requirements. The basic types of process structures are workcenter, manufacturing cell, assembly line, and continuous process.

Question 5

Assume a fixed cost for a process of $100,000.The variable cost to produce each unit of product is $10 and the selling price for the finished product is $50.Ignoring inventory,how many units must the firm sell to break-even?

Accepted Answer

The answer of Assume a fixed cost for a process...

Question 6

Assume a fixed cost for a process of $15,000.The variable cost to produce each unit of product is $10 and the selling price for the finished product is $25.Which of the following is the number of units that has to be produced and sold to break-even?
A)500 units
B)667 units
C)790 units
D)900 units
E)1,000 units

Accepted Answer

The answer of Assume a fixed cost for a process...

Question 7

A graphic used in process flow design depicting an exploded view of a product and its component parts is which of the following?
A)Route sheet
B)Gantt chart
C)Assembly drawing
D)Simo chart
E)Packing list

Accepted Answer

An assembly drawing is a type of technical drawing that depicts an exploded view of a product and its component parts. This type of drawing is commonly used in process flow design to help visualize the steps required for assembly and to identify any potential issues or inefficiencies. A route sheet is a document that outlines each step in a manufacturing or production process, while a Gantt chart is a type of project management tool used to track progress and dependencies. A Simo chart is a type of flowchart used to analyze and improve work processes, and a packing list is a document that lists the contents of a shipment.

Question 8

Give an example of a project layout?

Accepted Answer

The answer of Give an example of a project layout?...

Question 9

Which of the following is not considered a major process flow structure?
A)Project
B)Workcenter
C)Assembly line
D)Fabrication
E)Continuous Flow

Accepted Answer

Fabrication is not typically considered a major process flow structure; the major ones are project, workcenter, assembly line, and continuous flow.

Question 10

Assume a fixed cost for a process of $120,000.The variable cost to produce each unit of product is $35 and the selling price for the finished product is $50.Which of the following is the number of units that has to be produced and sold to break-even?
A)5,000 units
B)6,000 units
C)8,000 units
D)11,000 units
E)12,000 units

Accepted Answer

To break even, the total revenue generated by the sale of a certain number of units must be equal to the total cost incurred to produce those units. Let x be the number of units that need to be produced and sold to break even. 
Then, the equation: 
50x = 35x + 120,000 
Simplifying this equation: 
15x = 120,000 
x = 8,000 units

Therefore, the best choice is C, 8,000 units.

Question 11

A process flowchart uses the information presented in the assembly drawing and defines how parts go together and their order of assembly.

Accepted Answer

The answer of A process flowchart uses the information presented...

Question 12

The formats by which a facility is arranged are defined by the general pattern of work flow.

Accepted Answer

The formats by which a facility is arranged are indeed defined by the general pattern of work flow. This ensures that the facility layout is optimized for the most efficient production or service delivery process.

Question 13

A manufacturer has identified the options for acquiring a machined part.It can make the part on a numerically controlled lathe for $150 per unit (including materials. )It can make the part on a standard lathe for $250 per unit (also including materials. )It can make the part on a machining center for $50 per unit (also including materials. )The manufacturer can acquire a standard lathe for $10,000.It could acquire a numerically controlled lathe for $100,000.A machining center would cost $350,000.It has also found that it can purchase the part for $350 per unit?

Accepted Answer

The answer of A manufacturer has identified the options for...

Question 14

The major difference between the project and the assembly line categories of process flow structures is which of the following?
A)The size of the product
B)Discrete parts moving from workstation to workstation
C)Highly specialized equipment
D)Being a Virtual Factory
E)The product's volume and standardization

Accepted Answer

The major difference between project and assembly line categories of process flow structures is the product's volume and standardization. Projects are unique, one-time endeavors, while assembly lines involve producing large volumes of standardized products using a repetitive process. The other options (A, B, C, and D) may be relevant factors in determining the appropriate process flow structure, but they are not the major difference between project and assembly line categories.

Question 15

What is sometimes humorously referred to as a "gozinto chart"?
A)Assembly drawing
B)Assembly chart
C)Process flowchart
D)Operation and route sheet
E)Organization charts

Accepted Answer

An assembly chart is humorously referred to as a "gozinto chart" because it shows how parts "go into" an assembly.

Question 16

Assume that you are offered a new piece of equipment for $10,000.The equipment will produce 10,000 units per year with a margin of $6.00 per unit.Demand for the product being produced has been 2,000 units per year.Your current equipment is fully depreciated and can produce the 2,000 units per year at but at a margin of only $4.00 per unit.Under what conditions should you purchase the new equipment?

Accepted Answer

The answer of Assume that you are offered a new...

Question 17

Which of the following basic types of process structures is one which similar equipment or functions are grouped together?
A)Project
B)Workcenter
C)Manufacturing cell
D)Assembly line
E)Continuous process

Accepted Answer

A workcenter is a basic type of process structure where similar equipment or functions are grouped together.

Question 18

The most common production management tools used in planning and designing the process flow are assembly drawings,assembly charts,route sheets and product prototypes.

Accepted Answer

The answer of The most common production management tools used...

Question 19

In analysis using a process flowchart of a manufacturing operation,the emphasis is usually on identification of activities that can be minimized or eliminated.

Accepted Answer

Yes, the emphasis of a process flowchart in manufacturing is to identify activities that can be minimized or eliminated in order to improve efficiency and reduce costs.

Question 20

In a factory,machine A has a ten minute set-up time per batch and a two minute per unit run time.Machine B performs the identical function but has a set-up time of thirty minutes and a one minute run time per unit.The factory makes products in batches ranging from one unit to one hundred units.Assuming capacity is not a limitation on either machine,on which batches should machine B be used?
A)All batches should be run on machine B
B)Batches of more than 20 units should be run on machine B
C)Batches of fewer than 80 units should be run on machine B
D)Batches with up to 50 units should be run on machine B
E)No batches should be run on machine B

Accepted Answer

Machine B should be used for batches of more than 20 units because its lower per unit run time becomes advantageous despite the longer set-up time. For batches of 21 units or more, the total time on machine B becomes less than on machine A.

Quiz 7: Manufacturing Processes

Which of the following is a basic type of process structure?

Which of the following basic types of process structures is one which equipment or work processes are arranged according to the progressive steps by which the product is made?

Which of the following is not a basic type of process structure?

Assume a fixed cost for a process of $100,000.The variable cost to produce each unit of product is $10 and the selling price for the finished product is $50.Ignoring inventory,how many units must the firm sell to break-even?

Assume a fixed cost for a process of $15,000.The variable cost to produce each unit of product is $10 and the selling price for the finished product is $25.Which of the following is the number of units that has to be produced and sold to break-even?

A graphic used in process flow design depicting an exploded view of a product and its component parts is which of the following?

Give an example of a project layout?

Which of the following is not considered a major process flow structure?

Assume a fixed cost for a process of $120,000.The variable cost to produce each unit of product is $35 and the selling price for the finished product is $50.Which of the following is the number of units that has to be produced and sold to break-even?

A process flowchart uses the information presented in the assembly drawing and defines how parts go together and their order of assembly.

The formats by which a facility is arranged are defined by the general pattern of work flow.

The major difference between the project and the assembly line categories of process flow structures is which of the following?

What is sometimes humorously referred to as a "gozinto chart"?

Which of the following basic types of process structures is one which similar equipment or functions are grouped together?

The most common production management tools used in planning and designing the process flow are assembly drawings,assembly charts,route sheets and product prototypes.

In analysis using a process flowchart of a manufacturing operation,the emphasis is usually on identification of activities that can be minimized or eliminated.