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Exam 27: Lean Principles, Lean Accounting, and Activity Analysis

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Question 21

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Maximum effectiveness and efficiency are reached when the lean philosophy is used by both manufacturers and their suppliers.

A) True
B) False

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Question 22

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A lean nonmanufacturing process can be accomplished by consolidating, in one area, all of the services provided to a customer.

A) True
B) False

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Question 23

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Set up time is disregarded as an improvement priority under the manufacturing concept.

In a lean environment, process problems are more visible than they are in a traditional environment.

What do lean manufacturers demand from their vendors?

Setups are a significant time-consuming activity in traditional production environments.

Christmas Express makes wreaths in batch sizes of 12. The cutting & assembly process takes 8 minutes per wreath and the decorating process time is 10 minutes per wreath. It takes 12 minutes to move the wreaths from the cutting & assembly process to the decorating process. a) Compute the value-added, non-value-added, and the total lead time of the wreath process. b) Compute the value-added ratio. Round to the nearest decimal.

In a pull manufacturing system, raw materials are released to production based on forecasted demand.

manufacturing deals with several suppliers in hopes of finding the best price.

Lean manufacturing favors organizing work around products rather than around processes.

In a lean system, there are more transactions to record than there are in a traditional system.

Which of the following is not a prevention cost?

Reducing wait time is directly linked to reducing inventory.

How are the objectives of lean manufacturing achieved?

From the foregoing information, determine the production costs transferred to Cost of Goods Sold during August. '

In a lean environment, the journal entry to record raw materials purchases would include a credit to the raw materials inventory account.

From the foregoing information, determine the budgeted cell conversion cost per unit.

Peters Manufacturing Co. operates in a lean manufacturing environment. The company had scheduled production of 95,000 units during February in its Y12 cell. Actual February production totaled 88,200 units. Peters had budgeted conversion costs for February totaling $900,000 and budgeted production hours totaling 2,000. Compute Peters' budgeted cell conversion cost per unit for Cell Y12.

Identify the following quality control activities as either value-added or non-value-added. -Design engineering

All lead times are considered to be value-added lead time.