Question 1

A change to just-in-time manufacturing expands mainly the role of the

Accepted Answer

The answer of A change to just-in-time manufacturing expands mainly...

Question 2

How does pull-through production help minimize inventories in a just-in-time operating environment?

Accepted Answer

Pull-through production, which is also known as a "make to order" approach, means that products are only made when customer orders are received. This helps minimize inventories because there is no need to produce excess inventory in anticipation of demand. Instead, production is based on actual customer demand, which means that inventory levels can be controlled more precisely. This approach is a key component of a just-in-time operating environment.

Question 3

Just-in-time operations attempt to significantly reduce

Accepted Answer

Just-in-time operations aim to minimize waste by reducing inspection time and moving time, ensuring that materials and products are only produced and moved as needed.

Question 4

For work done during August, Printing Press Company incurred direct materials costs of $101,000 and conversion costs of $250,000. The company employs a traditional operating philosophy. At the end of August, it was determined that the Work in Process Inventory account had been assigned $1,000 of costs, and the ending balance of the Finished Goods Inventory account was $3,000. There were no beginning inventory balances. How much was charged to the Cost of Goods Sold account during August?

Accepted Answer

The answer of For work done during August, Printing Press...

Question 5

A just-in-time environment has smaller inventories than the traditional manufacturing environment. As a result,

Accepted Answer

A just-in-time environment is designed to reduce inventory and increase efficiency. This means that the just-in-time environment typically experiences a higher inventory turnover than the traditional environment as inventories are constantly replenished as needed. Choice A is incorrect because larger production lot sizes are not necessary in a just-in-time environment, as smaller, more frequent production runs are often preferred. Choice B is incorrect because a just-in-time environment actually requires less working capital for inventory, as inventory levels are kept low. Choice C is also incorrect because, as stated, a just-in-time environment typically experiences a higher inventory turnover than the traditional environment.

Question 6

In a just-in-time environment,

Accepted Answer

In a just-in-time environment, where production is closely tied to customer demand, any unexpected downtime can have significant consequences. Therefore, preventive maintenance is crucial to ensure that production continues uninterrupted. Scheduled maintenance is also important to avoid any unplanned downtime. This approach helps to minimize the cost of maintenance and maximizes productivity.

Question 7

Under new methods of management, attempts to continuously improve the work environment come from

Accepted Answer

Under new methods of management, everyone in the company is expected to contribute to continuous improvement of the work environment. This approach is often referred to as a "bottom-up" approach, where employees at all levels of the organization are encouraged to identify and implement improvements. This fosters a culture of continuous improvement and empowers employees to take ownership of their work environment.

Question 8

In a just-in-time operating environment, the key measure of cost incurred is

Accepted Answer

In a just-in-time operating environment, the emphasis is on reducing lead times and increasing efficiency. Therefore, the key measure of cost incurred is throughput time, which is the amount of time that it takes to convert raw materials into finished goods ready for sale. By minimizing throughput time, a company can lower inventory carrying costs, reduce waste, and maximize productivity. Direct labor hours and indirect costs may also be important measures, but they are not as directly related to the goals of a JIT system. Push-through time is not a standard measure of cost incurred in manufacturing.

Question 9

The actual amount of time that a product is being worked on is known as the

Accepted Answer

The processing time refers to the actual amount of time that a product is being worked on, which involves any activities or tasks that are involved in creating or completing the product. The other options are not as accurate or applicable in describing the amount of time a product is being worked on.

Question 10

In a traditional operating environment, a company usually

Accepted Answer

In a traditional operating environment, companies typically have long production runs with infrequent setups. This allows for greater efficiency in the manufacturing process and reduces the amount of time and resources needed for changeovers. Pull-through production scheduling, maintaining a minimum inventory level, and using a multiskilled work force are not necessarily characteristic of a traditional operating environment.

Question 11

Which of the following statements about a just-in-time operating environment is true?

Accepted Answer

A just-in-time operating environment aims to eliminate waste, including excessive inventories and nonvalue-adding activities. While quality is important, simplicity is also valued in order to streamline the production process. Just-in-time is based on pull-through production concepts, where production is based on customer demand, rather than pushing products through the system. Just-in-time is not directly tied to the scientific management principles established by F.W. Taylor.

Question 12

According to the just-in-time philosophy,

Accepted Answer

According to the just-in-time philosophy, maintaining inventories is considered wasteful, as it ties up resources and can cover up poor work or other problems. The focus is on producing only what is needed, when it is needed, and in the exact quantity needed to avoid waste and improve efficiency.

Question 13

In a just-in-time manufacturing environment, a flexible work cell is created by

Accepted Answer

In a just-in-time manufacturing environment, a flexible work cell is created by placing together a complete set of machines that produce a complete product. This allows for efficient and quick production of products in small batches, without the need for large inventories or excess capacity. Grouping similar machines or people may not necessarily lead to the same level of flexibility and efficiency.

Question 14

The initial step in achieving the efficiency of a just-in-time system is to

Accepted Answer

The initial step in achieving the efficiency of a just-in-time (JIT) system often involves redesigning the plant layout to minimize waste and reduce the time and distance materials need to travel through the production process. This setup is crucial for JIT, which aims to have materials arrive only as they are needed.

Question 15

Which of the following statements contradicts the philosophy underlying the just-in-time operating environment?

Accepted Answer

The just-in-time operating environment is built on the principle of having minimal inventory on hand to reduce waste and increase efficiency, so maintaining large inventories contradicts this philosophy. The other choices are consistent with the just-in-time operating environment.

Question 16

Xavier Products Company is in the process of adopting the just-in-time operating philosophy for its trophy-making operations. Indicate which of the following overhead costs is a nonvalue-adding cost (NVA).

Accepted Answer

Depreciation of the coffee machine is a nonvalue-adding cost because it does not directly contribute to the production process or add value to the product.

Question 17

Which of the following is not a concern when managing inventory in a just-in-time environment?

Accepted Answer

Inventory accuracy is still a concern when managing inventory in a just-in-time environment as it is crucial to have accurate and up-to-date inventory data to ensure timely ordering and delivery of goods. However, reduction of space needed to store inventory, inventory turnover, and inventory size reduction are all important goals in a JIT system.

Question 18

For work done during August, Printing Press Company incurred direct materials costs of $130,000 and conversion costs of $221,000. The company employs a traditional operating philosophy. At the end of August, it was determined that the Work in Process Inventory account had been assigned $1,000 of costs, and the ending balance of the Finished Goods Inventory account was $3,000. There were no beginning inventory balances. How much was cost of goods manufactured during August?

Accepted Answer

Cost of goods manufactured = Total manufacturing costs incurred - Ending Work in Process Inventory + Beginning Work in Process Inventory 
Since there was no beginning Work in Process Inventory, the equation simplifies to: 
Cost of goods manufactured = Direct materials costs + Conversion costs - Ending Work in Process Inventory 
Cost of goods manufactured = $130,000 + $221,000 - $1,000 = $350,000. Therefore, the correct option is B.

Question 19

In a just-in-time environment, managing the production process focuses on

Accepted Answer

The answer of In a just-in-time environment, managing the production...

Question 20

Maintaining consistent high product quality

Accepted Answer

Maintaining consistent high product quality is required for a just-in-time environment as it reduces waste and improves efficiency. It is also a by-product of the just-in-time environment as the focus on continuous improvement and lean manufacturing principles leads to better quality control. B and D are incorrect because just-in-time systems are designed to prioritize quality control and eliminate wasteful activities. C is incorrect because while quality control inspectors may be present, the goal of a just-in-time system is to prevent defects from occurring in the first place, not just catching them after they occur.

Quiz 22: Activity-Based Systems-Abm and Lean