ACC 221 class quiz

In a just-in-time-inventory (JIT) system, which statement is false:

• JIT combines purchasing, production and inventory control into one function.

• The main idea in a JIT system is that the company does not produce anything until the next process requires it.

• JIT is a pull system.

• Because JIT is a push system, production is not driven by the expected demand for the product.

An advantage of an enterprise resource planning system is that

• it can usually be installed by organizations of all sizes.

• the system can be easily customized to suit the unique needs of the organization.

• the comprehensiveness of the system reduces resistance to change.

• its implementation improves business processes.

A company is planning to implement a just-in-time (JIT) inventory management system. All of the following are benefits expected from implementing JIT except

• lower investment in inventory.

• lower obsolescence and other carrying costs.

• higher inventory turnover.

• fewer defects and less rework.

Successful implementation of a just-in-time (JIT) inventory system requires all of the following except

• close relationships with suppliers.

• close coordination between and among work stations.

• each worker is able to operate all machinery and perform all supporting tasks.

• use of Enterprise Resource Planning (ERP) software.

Roberta Johnson is the manager of Sleep-Well Inn, one of a chain of motels located throughout the U.S. An example of an operating cost at Sleep-Well that is both direct and fixed is

• Johnsons salary.

• Water.

• Toilet tissue.

• Advertising for the Sleep-Well Inn chain.

Cost drivers are

• activities that cause costs to increase as the activity increases.

• accounting techniques used to control costs.

• accounting measurements used to evaluate whether or not performance is proceeding according to plan.

• a mechanical basis, such as machine hours, computer time, size of equipment, or square footage of factory, used to assign costs to activities.

To meet Zylon Corporation's overall objectives, the Frame Division has just initiated a program to increase sales by improving the manufacturing quality of its products. The most appropriate management level to be responsible for this program is the

• sales manager.

• production manager.

• division president.

• receiving and inspection manager.

Which of the following would be a reasonable basis for allocating the material handling costs to the units produced in an activity-based costing system (ABC)?

• Number of production runs per year.

• Number of components per completed unit.

• Amount of time required to produce one unit.

• Amount of overhead applied to each completed unit.

The allocation of costs to particular cost objects allows a firm to analyze all of the following except

• Whether a particular department should be expanded.

• Why the sales of a particular product have increased.

• Whether a product line should be discontinued.

• Why a particular product should be purchased rather than manufactured in-house.

An accounting system that collects financial and operating data on the basis of the underlying nature and extent of the cost drivers is

• Direct costing.

• Activity-based costing.

• Cycle-time costing.

• Variable costing.