AIS Chapter 7

An example of automation of manufacturing planning is

Materials Requirements Planning

In traditional firms, information reporting

provides financially oriented information relating to operations

All of the following are documents in batch process production systems except

purchase order

Characteristics of Just-In-Time manufacturing include all of the following except

push manufacturing

A move ticket

records the work done in each work center

Firms implement a Just-In-Time inventory approach to

reduce investment in inventories

Process simplification focuses on

reducing the complexity of the physical manufacturing layout of the shop floor

The SAP R/3 system provides pre-defined modules to support business processes in the all of the following categories except

strategic

What is the economic order quantity if the annual demand is 10,000 units, set up cost of placing each order is $3 and the holding cost per unit per year is $2?

174

If the daily demand is 40 units and the lead time is 12 days, the reorder point is

480 units

The purpose of the cost accounting system is to

produce information for inventory valuation

An example of automation of manufacturing design is

Computer Aided Engineering

A manufacturing process that is organized into group technology cells utilizing no human labor is called

Computer Integrated Manufacturing

All of the following are characteristics of batch processing except

batches are produced in accordance with detailed customer specifications

Which process creates a homogeneous product through a continuous series of standard procedures

continuous process

Which statement is not correct? (activity/cost object)

cost object describes the work performed in a firm

Which item does not describe a world-class company?

customers in a world-class company are external departments only

Which statement is not correct?

general ledger creates a new cost record upon receipt of a work order from production planning and control

Manufacturing flexibility incorporates four characteristics. These include all of the following except

high inventory levels

Types of information provided by Activity Based Costing include

identification of cost drivers

The internal control significance of the excess materials requisition is that it

identifies materials used in production that exceed the standard amount allowed

Deficiencies of the traditional cost accounting information system include all of the following except

immediate feedback about deviations from the norm

Which statement is not correct

in world-class manufacturing firms, quality control activities at the end of the process are essential

Which situation violates the segregation of functions control procedure?

inventory control maintains custody of inventory items

Firms are adopting Activity Based Costing (ABC) because

it more accurately allocates costs to products

Computer integrated manufacturing groups all of the following technologies except

materials requirements planning

The storekeeper releases raw materials based on the

materials requisition

An example of a continuous process is the production of

milk products

Which subsystem is not a part of the production system?

monitoring the flow of cost information related to production

Inventory control performs all of the following tasks except it

prepares a materials requisition for each production batch

The cost of poor quality includes all of the following except

proceeds from the sale of scrap

All of the following are internal control procedures that should be in place in the conversion cycle except

retention of excess materials by work centers

Which of the following is not a category of critical success factors in most manufacturing companies?

revenue generation

A flexible manufacturing system

shortens the physical distance between activities

The production schedule is

the formal plan and authority to begin production

Transaction authorization occurs in a traditional manufacturing environment in all of the following ways except

the sales department modifies work orders to match changes in demand

When determining which items to produce, a firm must know

the sales forecast

Which of the following is not an assumption of the Economic Order Quantity model?

total cost per year of placing orders is fixed

The stages of the automation continuum are (in order)

traditional, islands of technology, process simplification, computer-integrated manufacturing

Firms hold safety stock to compensate for

variations in lead time or daily demand