B) Finished goods are produced ahead of customers' orders to protect against running out of finished goods
inventory.
C) Customer orders drive the production process.
D) Inventory levels are maintained at high levels.
Answer: C
179) The production system designed to eliminate waste is called a(n)
A) activity- based system. B) lean production system.
C) full costing system. D) traditional system.
Answer: B
180) A system in which companies purchase raw materials only when needed is called
A) Traditional production system B) internal failure costs.
C) ABC. D) JIT production.
Answer: D
181) Which term listed below describes a system where companies purchase raw materials when needed in
production and complete finished goods when needed by customers?
A) TQM B) Traditional production system
C) Just- in-time inventory D) Supply chain management
Answer: C
182) As part of ________, each business function examines its own activities and works to improve performance by
continually setting higher goals.
A) ISO 9001:9008 B) supply chain management
C) lean production D) TQM
Answer: D
183) The philosophy and a business strategy of manufacturing without waste is referred to as
A) TQM. B) ISO 900.
C) lean production. D) thin manufacturing.
Answer: C
184) Which of the following describes a system in which suppliers deliver materials at the time they are needed?
A) ISO B) TQM C) ERP D) JIT
Answer: D
185) ISO 9001:2008 is a(n)
A) certification that a company complies with international quality standards.
B) system where production occurs only when needed.
C) effective exchange of information between vendors and customers.
D) software system which integrates all departments.
Answer: A
186) Companies that wish to demonstrate their commitment to international quality standards may become certified
by what organization?
A) IMA B) ISO C) SEC D) IFRS
Answer: B
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187) Throughput time is cut when which of the following methods is used?
A) XBRL B) JIT C) IFRS D) ISO
Answer: B
188) The philosophy that centres on production as needed is known as
A) ERP. B) JIT.
C) Supply- chain management. D) TQM.
Answer: B
189) The philosophy of providing superior goods and services is
A) ERP. B) JIT.
C) Supply- chain management. D) TQM.
Answer: D
SHORT ANSWER. Write the word or phrase that best completes each statement or answers the question.
190) Identify and explain some of the reason why companies want to reduce inventory levels.
Answer: Inventories tie up cash
Large inventories may hide quality problems, production inefficiencies, and obsolescence
Storing and retrieving inventory is very expensive
191) In a lean production environment, employees working in production cells often do more than operate one
machine. What additional tasks do they do?
Answer: Conduct maintenance
Perform setups
Inspect their own work
Operate other machines
192) Identify the common characteristics of a lean production system
Answer: Production occurs in self- contained cells
Broad employee roles
Batches produced Jus- in- Time
Reduced set- up times
Shortened Manufacturing Cycle Times
Emphasis on quality
Supply chain management
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MATCHING. Choose the item in column 2 that best matches each item in column 1.
Match the following:
193) Quality tends to be "build-in" rather
than "inspect- in."
Answer: B
194) Manufacturing plants tend to be
organized with self- contained
production cells.
Answer: B
195) The company maintains lower
quantities of raw materials, work in
process, and finished goods
inventories.
Answer: B
196) Set- up times are shorter.
Answer: B
197) High quality is stressed in every
aspect of production.
Answer: B
198) Products are made in larger batches.
Answer: A
199) Emphasis is placed on shortening
manufacturing cycle times.
Answer: B
200) Manufacturing plants tend to group
like machinery together in different
parts of the plant.
Answer: A
201) Set- up times are longer.
Answer: A
202) The company maintains high
inventory levels to guarantee supply.
Answer: A
A) Traditional
B) Lean
TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false.
203) Appraisal costs are incurred to detect poor-quality goods or services.
Answer: True False
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204) Internal failure costs occur when the company detects and corrects poor- quality goods or services after delivery
to customers.
Answer: True False
205) Inspection of incoming raw materials and production loss caused by downtime are examples of prevention