Deck 7: Manufacturing Processes

Question 1

The volume requirements for the product are one determinant of the choice of which process structure to select.

Answer 1

True
Explanation: Two dimensions (of the product/process matrix, Exhibit 7.2) are shown.The first dimension relates to the volume of a particular product or group of standardized products.Standardization is shown on the vertical axis and refers to variations in the product that is produced.These variations are measured in terms of geometric differences, material differences, and so on.Standardized products are highly similar from a manufacturing processing point of view, whereas low standardized products require different processes.

Question 2

One methodology used to evaluate equipment investment decisions where the investment entails an initial investment, fixed costs, and variable costs is break-even analysis.

Answer 2

True
Explanation: A standard approach to choosing among alternative processes or equipment is break-even analysis.

Question 3

Process selection refers to the strategic decision of choosing the volume of output to produce in a manufacturing facility depending upon the way that facility produces.

Answer 3

False
Explanation: Process selection refers to the strategic decision of selecting which kind of production processes to use to produce a product or provide a service.

Question 4

The term "assembly line" refers to progressive assembly linked by some material handling device.

Question 5

The product-process matrix shows the relationship between process structures and product volume and variety characteristics.

Question 6

A continuous process indicates production of discrete parts moving from workstation to workstation at a controlled rate.

Question 7

Engineer-to-order firms will work with the customer to design the product and then make it from purchased materials, parts, and components.

Question 8

A make-to-order firm will work with the customer to design the product and then make it from purchased materials, parts, and components.

Question 9

Work-center layouts allocate dissimilar machines into cells to work on products that have dissimilar processing requirements.

Question 10

The closer the customer is to the customer order decoupling point, the more quickly the customer receives the product.

Question 11

Process selection refers to the strategic decision of selecting which kind of production processes to use to produce a product or provide a service.

Question 12

A project layout is characterized by a relatively low number of production units in comparison with process and product layout formats.

Question 13

One trade-off illustrated by the product-process matrix is between flexibility and cost.

Question 14

A project layout is characterized by a high degree of task ordering.

Question 15

One difference between an assembly line process flow and a continuous process flow is that on the assembly line the flow is discrete rather than continuous.

Question 16

The time needed to respond to a customer's order is called the customer response time.

Question 17

The closer the customer is to the customer order decoupling point, the longer it takes the customer to receive the product.

Question 18

A general-purpose machine is less capable than a special-purpose machine in certain tasks but can perform a broader variety of tasks.

Question 19

Break-even analysis can only be used in production equipment decision making when dealing solely with fixed costs, not variable costs.

Question 20

Break-even analysis can be used to help decide whether to perform a task with a special-purpose machine or with a general-purpose machine.

Question 21

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

Question 22

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

A)Work center
B)Project
C)Assembly line
D)Fabrication
E)Continuous flow

Question 23

An example of an assemble-to-order firm is Dell Computer.

Question 24

Which of the following is not a step in developing a manufacturing cell layout?

A)Grouping parts into families that follow a common sequence of steps
B)Identifying dominant flow patterns of parts families as a basis for location of processes
C)Physically grouping machines and processes into cells
D)Disposing of leftover machinery and outsourcing ungrouped processes
E)None of these

Question 25

A high-level map or diagram of a supply chain process can be useful to understand how material flows and where inventory is held.

Question 26

In a work center, machine A has a 10-minute set-up time per batch and a 2-minute per unit run time.Machine B performs the identical function but has a set-up time of 30 minutes and a 1-minute run time per unit.The work center makes products in batches ranging from 1 unit to 100 units.Assuming capacity is not a limitation on either machine, in order to minimize the total processing time, 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.

Question 27

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

A)Process flow diagram
B)Product matrix
C)Process matrix
D)Work center
E)Manual assembly

Question 28

A difference between project and continuous flow categories of process flow structures is which of the following?

A)The size and bulk of the product
B)Discrete parts moving from workstation to workstation
C)Degree of equipment specialization
D)Being a "virtual factory"
E)Profit per unit

Question 29

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

A)Project
B)Work center
C)Manufacturing cell
D)Assembly line
E)Continuous process

Question 30

The focus in the make-to-stock environment is on providing finished goods where and when the customers want them.

Question 31

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? ______________________

Question 32

The essential issue in satisfying customers in the make-to-stock environment is to balance the level of finished inventory against the level of service to the customer.

Question 33

Give an example of a project layout.______________________

Question 34

Assemble-to-order means moving the customer order decoupling point from finished goods to components.

Question 35

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

A)Project
B)Work center
C)Manufacturing cell
D)Assembly line
E)Continuous process

Question 36

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

A)Product-process matrix
B)Work center
C)Manufacturing cell
D)Assembly line
E)Continuous process

Question 37

The placement of which of the following is not determined by production process organization decisions?

A)Departments
B)Work groups
C)Workstations
D)Machines
E)Emergency exits

Question 38

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 worldwide 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 is a good investment.
D)The break-even is lower than the 15,000 units that are expected to sell.
E)All of these

Question 39

The essential issue in satisfying customers in the make-to-stock environment is to balance the cost of the finished item against the willingness of the consumer to pay for it.

Question 40

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

Question 41

Describe the implications of the product-process matrix for process design in a competitive situation.

Question 42

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.Should you purchase the new equipment? Under what conditions?

Question 43

Distinguish between a work center and a manufacturing cell.

Question 44

A manufacturer has identified the options for acquiring a machined part.It can make the part on a standard lathe for $250 per unit (including materials).It can make the part on a numerically controlled lathe for $150 per unit (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.What are the ranges in demand for which each method of procuring a part described above will be most economical?