b False As long as production sustaining costs which are fixed with respect to

B false as long as production sustaining costs which

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b. False. As long as production-sustaining costs (which are fixed with respect to all volume measures) are allocated to products based on expected or actual volume, then unit costs will vary inversely with volume. “Normal costing” must be used for each allocation base to prevent unit costs from varying with volumes. For example, batch-level costs must be allocated based on the normal number of batches over the business cycle as long as there are any fixed costs (fixed with respect to the number of batches) in batch-level costs.
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Exercises ABC, TQM, JIT, BSC (Chapters 11 and 14) Group XA Cristiana Parisi 21.02.2020 3 Chapter 14 – Multiple Choice questions Question 14.1 Which is not true of Total Quality Management (TQM)? A. TQM is focused on improving product and customer service quality B. TQM is expensive to initiate C. TQM requires top management support D. TQM requires ISO 9000 certification E. All of the above TQM does not require ISO 9000 certification. However, many firms choose to apply for certification to advertise to their customers their commitment to quality improvement Question 14.2 Typical quality improvements include: A. product redesign B. electronic defect detection C. alteration of organizational architecture to increase local responsiveness to customer needs D. purchase of robotic manufacturing systems E. all of the above All these and more have been implemented. Question 14.3 Typical measures of quality include: A. percentage of defects B. dollars spent on rework C. number of on-time deliveries D. customer satisfaction surveys E. all of the above Quality measures utilize a variety of dollar measures, as well as non-financial measures such as error rates, pounds wasted, time spent, etc.
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Exercises ABC, TQM, JIT, BSC (Chapters 11 and 14) Group XA Cristiana Parisi 21.02.2020 4 Question 14.4 Which is false of just-in-time (JIT) manufacturing systems? A. Demand pull means a closer relationship with the customer B. The power of suppliers is reduced C. Warehousing needs are reduced D. After process re-engineering, time to complete the product is reduced E. None of the above Under JIT, firms typically contract with a smaller number of high quality suppliers. The power of suppliers is increased under JIT. Failure of the raw materials or sub-components to arrive in perfect condition and on time can seriously disrupt production. Stringent contracts are written to try to control this situation . Question 14.5 Kosmic Kan produces Kaos, a leading edge computer game. It is implementing a balanced scorecard to assess performance across multiple dimensions. Which is not an appropriate measure? A. Financial: increase earnings per share by $0.12 B. Customer: add customer value C. Learning and innovation: recruit 50 new staff from leading schools D. Internal processes: reduce programming errors by 3% E. None of the above All the others are appropriately matched, specify the dimension to be measured, and indicate the measurement method. The customer perspective has not indicated what is to be measured nor how.
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  • Fall '18
  • XA Cristiana Parisi

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