CHP 17 HW-Acct 331
The five principles of lean manufacturing are: , value stream, pull and , empowerment, and
Blank 1: value Blank 2: flow Blank 3: perfection
Let TQC = the total quality cost (out-of-pocket cost + opportunity cost) due to deviation of the quality characteristic from its targeted value. In a Taguchi Quality Loss Function (QLF), k (the cost coefficient) can be estimated as ______.
TQC ÷ (Tolerance Allowed)^2 note: ^2 means squared
In a cost of quality (COQ) framework, costs associated with defective/poor-quality outputs detected after being delivered to the customer are typically classified as ______ costs.
external failure
Equipment maintenance cost is a(n) ______ cost. Multiple choice question.
prevention
Absolute quality conformance standards assume that ______.
(Conformance that aims for all products or services to meet the quality target value exactly, with no variation.) -deviations from the targeted level of the quality characteristic have negative consequences -any deviation from the targeted level for the quality characteristic is a quality failure
It is generally recommended that cost information included in a COQ (Cost-of-Quality) report ______.
-be confined to (i.e., focused on) quality initiatives specified by top management -be expressed in relative terms (e.g., as a percentage of net sales for the period)
In a cost of quality (COQ) reporting framework, internal failure costs generally include ______.
-cost of corrective actioln -rework and scrap costs -process costs -expediting costs -reinspection and retest costs -lost contribution due to increased demand on contrained resources-an opportunity costs
Quality costs (losses) in a Taguchi Quality Loss Function (QLF) include ______. (Depicts, in the form of a quadratic function, the relationship between quality costs and level of deviation from the target quality level or specification.)
-customer dissatisfaction -loss f future business -lss of market share -cost w/ holding inventory -repair costs
The underlying assumption of a Taguchi quality loss function (QLF) is ______.
-every time the departure from targeted value of the quality characteristic doubles, the loss (quality cost) quadruples -the underlying cost (loss) function is best represented as a quadratic function -the total quality cost (or loss) grows larger as the variation from targeted value increases
The Taguchi Quality Loss Function (QLF) ______. Multiple select question.
-is consistent with absolute conformance standards -depicts the relationship between quality costs and level of deviation from target quality
Relevant external nonfinancial quality measures include ______.
-number of defective units shipped to customers as a percentage of total units shipped -number of customer complaints -customer loyalty -percentage of products that experience early or excessive failure -marketshare -delivery delayhs -on-time delivery -market research information on -customernpreferences and satisfaction with specific product features -customer response time -net promoter score
After adopting lean manufacturing, there is generally a delay in improvement in financial performance because ______.
-previously capitalized fixed costs held in inventory are released on the income statement, thereby decreasing short-term earnings -sales may initially fall as customers order in smaller lot sizes -productivity improvements initially create excess capacity
Internal nonfinancial quality measures include ______.
-process yield -productivity -percentage of first pass yield -number of defective parts produced -machine downtime -trend in dollar amount inventory held -safety record -throughput -production lead time -cycle efficiency -new product development time
Prevention costs include ______.
-quality training costs -equipment maintenence costs -supplier assurance costs -information systems costs -product redesign and process improvement -quality circles
In a Taguchi Quality Loss Function (QLF) the total cost of deviation from the quality standard includes ______.
-rework -repair -production costs -loss on disposal -opportunity costs
Appraisal costs in a cost of quality (COQ) reporting framework generally include ______.
-test and inspection costs -test equipment and instruments
Prevention costs include ______. -re-inspection and retest costs -the cost of preparing, distributing, and updating employee handbooks and manuals -costs incurred to test and inspect incoming materials -supplier-assurance costs -the cost of internal training programs
-the cost of preparing, distributing, and updating employee handbooks and manuals -supplier-assurance costs -the cost of internal training programs
Given k (the cost coefficient in a Taguchi quality loss function) = $250,000, total quality cost (TQC) = $1,000, and T (the target value of the quality characteristic) = 0.50, what is the estimated quality loss, L(x), for x = 0.48?
L(x)=k(x-T)^2 L(.48)=250,000(.48-.50)^2 =250,000*0.0004=100 quality loss= 100
Principal elements of accounting for lean include ______.
an attempt to document the financial benefits of adopting lean manufacturing. the creation of "value streams" as the basis for costing output
In a cost of quality (COQ) reporting framework, expenditures for test equipment and instruments are considered ______ costs.
appraisal
Nonfinancial measures of quality are a critical component of a comprehensive framework for managing and controlling quality because they ______.
are relevant to operating personnel are generally less costly to obtain that financial measures of quality can be useful predictors of future financial performance
Another name for relevant costs is ___ costs. (Enter only one word per blank.)
avoidable or differential
The total cost of quality (COQ) is the sum of ___ and ___ costs.
conformance, nonconformance
Successive observations of an operation (or cost) taken at constant intervals are plotted on a(n) ____ ____ .
control chart
A useful tool for structuring a Cost-of-Quality (COQ) report is a(n) ______.
cost-of-quality matrix
In a typical cost of quality (COQ) report, the cost of product recalls is reported as a(n) ______ cost.
external failure
True or false: Commodity-based firms with a few homogeneous products can benefit from value-stream income statements.
false
True or false: Cost-of-Quality (COQ) reports are not well-suited to an ABC system environment. True false question.
false
Control charts are appropriate for use with ______ standards. Multiple choice question.
goalpost performance
A graphical representation of the frequency of attributes or events in a given set of data is called a(n) ____
histogram
The diagnostic tool that is a visual representation of the frequency of occurrence of events or causes of poor quality is a ______. Multiple choice question.
histogram
Quality costs (losses) in a Taguchi Quality Loss Function (QLF) include ______.
increased warranty repair costs customer dissatisfaction loss of market share
Costs associated with defective processes or defective products detected before delivery to customers are, in a cost of quality (COQ) reporting framework, considered ______ costs. Multiple choice question.
internal failure
Let T = the targeted value of a quality characteristic, x = the observed value of the quality characteristic, and k = the cost coefficient (based on the firm's costs of failure). The loss, L(x) from having an observed quality characteristic x can be estimated by ______.
k(x - T)2
Assume a company has determined that no customer will accept shower door glass deviating more than 0.04 inches in thickness and that the target thickness is 0.5 inches. The estimated cost to the firm for each rejection is $750. If the actual thickness of a unit is 0.48, the estimated quality cost for this unit is ______. L(x)=k(x-T)^2 k=total quality cost/(tolerance allowed)^2
k=750/.04^2 k=750/.0016=$468,750 L(.48)= $468,750*(0.48-0.50)^2 = $468,750*0.0004=187.50 estimated loss=$187.50
A new approach to costing and performance measurement that helps an organization show the financial benefits of the lean manufacturing initiative is called ___ ___
lean accounting
The Toyota Production System is at the head of ___ ___
lean manufacturing
Value (to the customer), value stream, pull and flow, empowerment, and perfection can be viewed as the five principles of ______. Multiple choice question.
lean manufacturing
Lean manufacturing and associated accounting for lean is ______. Multiple choice question.
most applicable to firms operating in highly competitive and dynamic markets
In a cost of quality (COQ) reporting framework, one example of ___ costs is the cost of establishing and operating quality circles.
prevention
Costs of conformance consist of ______ costs.
prevention and appraisal
A small group of employees from the same work area that meets regularly to identify and solve work-related problems, and to implement and monitor solutions is a(n)___ ___ .
quality circle
The absolute or ____ quality approach to setting quality expectations aims for all products or services to meet the target value exactly, with no variation.
robust
The primary reason for including feedback loops throughout the comprehensive framework for managing and controlling quality presented in Chapter 17 is to ______. Multiple choice question.
support the organization's overall goal of continuous improvement
Principal elements of accounting for lean include ______.
the creation of "value streams" as the basis for costing output an attempt to document the financial benefits of adopting lean manufacturing.
Long-term relationships with suppliers, balanced, continuous-flow manufacturing, continuous product design improvements, and flexible manufacturing systems are the main elements of the ___ ___ system
toyota production
True or false: Activity and process decisions (for example, factory layout) are examples of quality-related investments. True false question.
true
True or false: Organizations that adopt lean manufacturing usually also adopt lean accounting.
true
Financial performance measures related to quality are ______.
useful for summarizing the financial impact of quality and quality-related initiatives/programs
