Managerial Accounting: Tools for Business Decision-Making 6th Canadian Edition by Jerry J. Weygandt

b) By using enterprise resource planning systems.
c) By using just-in-time methods.
d) By using total-quality management systems.
 
 
73. Which one of the following characteristics would likely be associated with a just-in-time inventory method?
a) ending inventory of work in process that allows for several production runs
b) a backlog of inventory orders not yet shipped
c) minimal finished goods inventory on hand
d) an understanding with customers that they may come to the showroom and select from inventory on hand
 
 
74. What is value chain management best defined as?
a) a large chain that keeps the machines from falling on the production floor
b) management decisions that affect how quickly the production run occurs
c) the incremental value of costs associated with hiring a new production floor leader
d) all activities associated with providing a product or service
 
 
75. Which one of the following is an example of activity-based costing?
a) monitoring the salaries of managers that do untimely quality control checks
b) keeping close track of shrinkage associated with thefts off the showroom floor
c) ensuring that management is diligently working with the local union on keeping labour costs in line
d) allocating the set-up cost associated with getting a machine ready for a production run
 
 
76. Bottlenecks are
a) the point at which the finished product leaves the factory.
b) constraints that limit the company’s potential profitability.
c) the point at which a company’s plan is put into action.
d) factors that consume a great deal of managers’ attention but have little impact on the company.
 
 
77. For what reason is a product cost primarily tracked?
a) to keep up with current cost trends to bring products to market
b) to effectively allocate the cost of products to measure profitability
c) to determine what amounts are necessary for allocating overhead
d) to keep management’s bonuses increasing every year
 
 
78. Which one of the following is an activity not associated with TQM?
a) Tightening the bolts on a chassis so that the frame will not drop out.
b) Redesigning the gas tank after learning fuel efficiency standards are not being met.
c) Verifying the 10 check points associated with producing the highest quality loaf of bread.
d) Ensuring that the mattress just manufactured meets the standard of comfort of a random factory line worker.
 
 
79. The theory of constraints is
a) a theory that the benefit of making a change in a production process should be weighed against the cost of making that change.
b) that even the best suggestions for improvement are likely to be rejected due to opposition from those who have to implement the changes.
c) a specific approach used to identify and manage constraints in order to achieve the company’s goals.
d) not applicable to service operations.
 
 
80. What is ERP?
a) efficient resource procurement
b) earnings reporting policies
c) enterprise resource planning
d) effective resource procurement
 
 
81. A balanced scorecard is
a) a performance-measurement approach that uses both financial and non-financial measures to evaluate a company’s operations in an integrated way.
b) a tool used to measure the benefits and costs of implementing a new strategy.
c) used only by small organizations that cannot afford more expensive methods of evaluating their operations.
d) focuses on non-financial measures in order to balance the many other financial reports companies use to evaluate their operations.
 
 
82. Which component of a company’s value chain would benefit most from internal management information?
a) complaints from its customers over services offered
b) bonuses paid to managers of the company
c) the company’s efforts to develop new services
d) All such components would benefit from internal management information.
 
 
83. Managerial accounting has become more important in service industries due to
a) the decline of the manufacturing sector has freed up many accountants.
b) service delivery is extremely complex and requires proper monitoring.
c) the economy has become more service-oriented recently.
d) the increase in complexity in computer systems requires accounting specialists.
 
 
84. The five steps in the lean thinking model, in order are:
a) 1. Define value, 2. Identify the pull factors, 3. Identify the value stream, 4. Make the value stream flow, 5. Revise until perfection is achieved.