Chapter 7
Assume a fixed cost for a process of $15,000. The variable cost to produce each unit of product is $10, and the selling price for the finished product is $25. Which of the following is the number of units that has to be produced and sold to break even?
1,000 units
Assume a fixed cost for a process of $120,000. The variable cost to produce each unit of product is $35, and the selling price for the finished product is $50. Which of the following is the number of units that has to be produced and sold to break even?
8,000 units
Which of the following basic types of process structures is one in which equipment or work processes are arranged according to the progressive steps by which the product is made?
Assembly line
In a work center, machine A has a 10-minute set-up time per batch and a 2-minute per unit run time. Machine B performs the identical function but has a set-up time of 30 minutes and a 1-minute run time per unit. The work center makes products in batches ranging from 1 unit to 100 units. Assuming capacity is not a limitation on either machine, in order to minimize the total processing time, on which batches should machine B be used?
Batches of more than 20 units should be run on machine B
Which of the following is not a step in developing a manufacturing cell layout?
Disposing of leftover machinery and outsourcing ungrouped processes
The placement of which of the following is not determined by production process organization decisions?
Emergency exits
Which of the following is not considered a major work flow structure?
Fabrication
Which of the following is not a basic type of process structure?
Product-process matrix
You are hired as a consultant to decide if your client should purchase a new, highly specialized piece of equipment. The product to be produced by this equipment is forecast to have a total worldwide demand of 15,000 units over the entire product life. The initial investment to acquire and install the equipment is $256,000. The variable cost to produce each unit will be $15, and the selling price for the finished product will be $30. Which of the following best describes the situation the firm is facing?
The company's total margin will be less than its investment.
A difference between project and continuous flow categories of process flow structures is which of the following?
The size and bulk of the product
Which of the following basic types of process structures is one in which similar equipment or functions are grouped together?
Work center
Which of the following is a basic type of process structure?
Work center
