Cost Accounting Systems (D. Product Quality and Productivity/ Total Quality Management)
(. t#e same same outut outut is roduced roduced %it# t# $e%er inuts. nuts. D. la!ore la!orers rs ut in more more e$$ort e$$ort.. 7. A artial artial roductivity roductivity measure measure #as several limitations& including including t#at' A. it ignores any roductivity roductivity e$$ect e$$ect caused !y ot#er ot#er manu$acturing manu$acturing $actor uantity c#anges. c#anges. ). it ignores any any e$$ect t#at t#at c#anges in t#e roduction roduction $actor #ave #ave on roductivity. roductivity. (. it ignores and and e$$ect t#at c#anges c#anges in oerating oerating c#aracteristics c#aracteristics o$ t#e $irm may may #ave on t#e roductivity o$ t#e inut resource. D. all o$ t#e a!ove a!ove ans%er ans%erss are correct correct..
1. A rimary rimary o!"ective ve in measuring ng roductivity roductivity is to imrove oeration oerationss eit#er !y using $e%er inuts to roduce t#e same outut& or to roduce' A. more e$$ectively e$$ectively (. more outu oututs ts %it# t#e same same inuts inuts ). %it# $e%er constraints D. more oututs %it# more inuts *. +#ic# o$ t#e $ollo%ing $ollo%ing assesses assesses t#e roductivity roductivity e$$iciency e$$iciency $or all inuts com!ined com!ined in order order to value c#ange in roductivity, A. artial roductivity roductivity measurement measurement (. ro$it-lined roductivity roductivity measurement measurement ). ro$ile ro$ile roduct roductivity ivity measu measureme rement nt D. total rodu roductiv ctivity ity measur measuremen ementt
8. An advantage advantage o$ artial artial measure measuress o$ roductiv roductivity ity is t#at t#at it' A. allo%s managers to $ocus on t#e use o$ a articular inut. ). is a comle3 measure measure t#at t#at is di$$icult to interret interret !y everyone everyone in t#e organi5atio organi5ation. n. (. loos at t#e e$$ect e$$ect o$ o$ multile multile inuts. inuts. D. is a er$ect er$ect measure measure o$ er$orman er$ormance. ce.
. (#anges in t#e roductivity roductivity o$ di$$erent di$$erent tyes o$ resources resources are 0OT al%ays' A. measura!le and and o!serva!le o!serva!le ). in t#e same same direction rection or at at an eual eual ace ace (. uniue uniue and di$$erenti di$$erentiated ated D. simultane simultaneous ous and ositive tive
9. (#aracte (#aracteristi ristics cs o$ total uality uality managemen managementt include' include' A. $ocusing on customer customer satis$action satis$action ). striving ving on on continuo continuous us imrove imrovement ment (. involveme involvement nt o$ t#e entire entire %or %or $orce $orce D. All o$ t#e a!ove a!ove are are c#aracte c#aracteristi ristics cs o$ TQM TQM
2. Ho% can can roduc roductivit tivityy !e imrov imroved, ed, A. using less inut inut to roduce t#e same same outut ). using using t#e same same inut to roduc roducee more outut outut (. imrove inut inut trade-o$$ e$$iciency e$$iciency !y using a less less costly mi3 o$ inuts D. all o$ t#e a! a!ove ove
1:. +#ic# o$ t#e $ollo%ing $ollo%ing is not an imortant rincile rincile o$ TQM, A. T#e organi5ation organi5ation s#ould $ocus on on imroving goods goods $rom t#e consumer;s consumer;s vie%oint vie%oint ). Everyone in t#e organi5ation is reuired reuired to articiate (. T#ere s#ould s#ould !e a system system o$ lanning& lanning& controlling& controlling& and decision decision maing D. (om (omlace lacency ncy is t#e norm
4. One ma"or ro!lem ro!lem in measuring measuring roductivity in not-$or-ro$it not-$or-ro$it organi5ations organi5ations is t#e a!sence o$ revenue as t#e' A. common measure measure $or inuts ). comm common on measu measure re $or out oututs uts (. !asis $or $inancial $inancial reorting reorting D. common common denominat denominator or %it# commerc commercial ial $irms
11. 11. Total Total uality management management directs directs management management attention attention to t#e relations#i relations#i !et%een !et%een t#e internal roduction/service roduction/service rocess and t#e' A. (EO o$ t#e cometition cometition (. activity analysis analysis ). ult ultima imate te cus custom tomer er D. contro controll c#art c#artss
6. Produc Productivi tivity t y increa increases ses i$' i$' A. less outut is roduced %it# more inut. ). t#e same same outut outut is roduce roducedd %it# more more inut. inut.
1*. (ontinuous imrovement imrovement is synonymous synonymous %it#' A. rocess !enc#maring !enc#maring (. management !y o!"ectives o!"ectives ). tot total al uality uality manag manageme ement nt D. manageme management nt !y e3cetion e3cetion
57
Cost Accounting Systems (D. Product Quality and Productivity/ Total Quality Management)
@alue c#ain 19. +#ic# o$ t#e $ollo%ing $ollo%ing is t#e correct correct seuence o$ t#e value value c#ain, A. design& researc# and develoment& roduction& suly& mareting& customer service& distri!ution ). researc# and and develoment& develoment& design& suly& suly& roduction& roduction& mareting& mareting& distri!ution& customer customer service (. researc# researc# and develom develoment& ent& design& gn& suly& suly& roductio roduction& n& mareting mareting&& customer customer service& service& distri!ution D. suly& researc# and develoment& develoment& design& roduction& roduction& mareting& mareting& distri!ution& customer customer service
1. +#ic# o$ t#e $ollo%ing $ollo%ing descri!es t#e 5ero de$ects vie%, vie%, A. it ermits a redetermined redetermined level o$ de$ective de$ective units to !e roduced roduced ). it is t#e level level %#ere t#e num!er o$ de$ects allo%ed allo%ed minimi5es total total cost. (. it is t#e level level %#ere %#ere t#ere t#ere are no de$ects de$ects.. D. all o$ t#e a!ove a!ove..
Process value analysis *:. A tool t#at $ocuses on manu$acturing rocesses rocesses and sees to reduce or otimi5e t#e activities er$ormed %it#in t#e rocess is A. rocess value value analysis (. caveat caveat analy analysis sis ). re-engineering D. !enc#maring
Process !enc#maring 14. =ocusing on #o% !est in class class comanies ac#ieve ac#ieve t#eir results is re$erred to as' A. reverse engineering engineering (. roc rocess ess !enc !enc#mar #maring ing ). results !enc#maring D. cometitive !enc#maring Total uality control 16. T#e goal o$ total total uality control control is A. to #ave less de$ective material t#an good material ) . to ermit de$ects de$ects as long as t#ey do not not e3ceed a certain certain level (. to #ave #ave 5er 5eroo de$e de$ect ct D. !ot# !ot# ! and and c
*1. A tool t#at comares #o% tass tass are er$ormed internally %it# t#e !est ractices ractices o$ industry leaders is A. rocess value value analysis (. caveat caveat analys analysis is ). re-engineering D. !enc#maring **. Attemting to determine %#y activities activities are er$ormed er$ormed and #o% %ell t#ey are er$ormed er$ormed is a goal o$ A. rocess value value analysis ). !ot# tradition traditional al and activity-!a activity-!ased sed costing costing systems systems (. comuter comuter-inte -integrate gratedd manu$actu manu$acturing ring systems systems D. "ust-in-t "ust-in-time ime manu$actu manu$acturing ring
(ost o$ Quality Reort 17. Regardless o$ t#e di$$erences di$$erences in $orm and control& a common $eature t#at s#ould !e resent resent in any (ost o$ Quality Reort is t#at t#e reort' A. romotes total uality uality management >TQM? >TQM? ). strati$ies strati$ies costs costs !y roduct roduct line ine (. strati$ies strati$ies costs costs !y !y lant lant D. strati$ies strati$ies costs costs !y division division
18. @alue engineering can result result in A. roduct redesign redesign ). c#anges c#anges in mater materials ials seci$i seci$icati cations ons
Process Re-engineering *. An aroac# to develoing develoing ne% %ays to er$orm e3isting e3isting activities is called A. rocess value value analysis (. caveat analysis analysis ). re re-en -engin gineer eering ing D. !enc !enc#m #mar ari ing ng
(. modi$ications in rocess rocess met#ods D. al alll o$ t#e t#e a!o a!ove ve
*2. A danger danger in Process Process Reengineering Reengineering is t#at' t#at' A. non-value-9added non-value-9added activities activities may !e eliminated. eliminated. ). some resou resources rces may may no longer longer !e reuire reuired. d.
58
Cost Accounting Systems (D. Product Quality and Productivity/ Total Quality Management)
Cost Accounting Systems (D. Product Quality and Productivity/ Total Quality Management)
@alue c#ain 19. +#ic# o$ t#e $ollo%ing $ollo%ing is t#e correct correct seuence o$ t#e value value c#ain, A. design& researc# and develoment& roduction& suly& mareting& customer service& distri!ution ). researc# and and develoment& develoment& design& suly& suly& roduction& roduction& mareting& mareting& distri!ution& customer customer service (. researc# researc# and develom develoment& ent& design& gn& suly& suly& roductio roduction& n& mareting mareting&& customer customer service& service& distri!ution D. suly& researc# and develoment& develoment& design& roduction& roduction& mareting& mareting& distri!ution& customer customer service
1. +#ic# o$ t#e $ollo%ing $ollo%ing descri!es t#e 5ero de$ects vie%, vie%, A. it ermits a redetermined redetermined level o$ de$ective de$ective units to !e roduced roduced ). it is t#e level level %#ere t#e num!er o$ de$ects allo%ed allo%ed minimi5es total total cost. (. it is t#e level level %#ere %#ere t#ere t#ere are no de$ects de$ects.. D. all o$ t#e a!ove a!ove..
Process value analysis *:. A tool t#at $ocuses on manu$acturing rocesses rocesses and sees to reduce or otimi5e t#e activities er$ormed %it#in t#e rocess is A. rocess value value analysis (. caveat caveat analy analysis sis ). re-engineering D. !enc#maring
Process !enc#maring 14. =ocusing on #o% !est in class class comanies ac#ieve ac#ieve t#eir results is re$erred to as' A. reverse engineering engineering (. roc rocess ess !enc !enc#mar #maring ing ). results !enc#maring D. cometitive !enc#maring Total uality control 16. T#e goal o$ total total uality control control is A. to #ave less de$ective material t#an good material ) . to ermit de$ects de$ects as long as t#ey do not not e3ceed a certain certain level (. to #ave #ave 5er 5eroo de$e de$ect ct D. !ot# !ot# ! and and c
*1. A tool t#at comares #o% tass tass are er$ormed internally %it# t#e !est ractices ractices o$ industry leaders is A. rocess value value analysis (. caveat caveat analys analysis is ). re-engineering D. !enc#maring **. Attemting to determine %#y activities activities are er$ormed er$ormed and #o% %ell t#ey are er$ormed er$ormed is a goal o$ A. rocess value value analysis ). !ot# tradition traditional al and activity-!a activity-!ased sed costing costing systems systems (. comuter comuter-inte -integrate gratedd manu$actu manu$acturing ring systems systems D. "ust-in-t "ust-in-time ime manu$actu manu$acturing ring
(ost o$ Quality Reort 17. Regardless o$ t#e di$$erences di$$erences in $orm and control& a common $eature t#at s#ould !e resent resent in any (ost o$ Quality Reort is t#at t#e reort' A. romotes total uality uality management >TQM? >TQM? ). strati$ies strati$ies costs costs !y roduct roduct line ine (. strati$ies strati$ies costs costs !y !y lant lant D. strati$ies strati$ies costs costs !y division division
18. @alue engineering can result result in A. roduct redesign redesign ). c#anges c#anges in mater materials ials seci$i seci$icati cations ons
Process Re-engineering *. An aroac# to develoing develoing ne% %ays to er$orm e3isting e3isting activities is called A. rocess value value analysis (. caveat analysis analysis ). re re-en -engin gineer eering ing D. !enc !enc#m #mar ari ing ng
(. modi$ications in rocess rocess met#ods D. al alll o$ t#e t#e a!o a!ove ve
*2. A danger danger in Process Process Reengineering Reengineering is t#at' t#at' A. non-value-9added non-value-9added activities activities may !e eliminated. eliminated. ). some resou resources rces may may no longer longer !e reuire reuired. d.
58
Cost Accounting Systems (D. Product Quality and Productivity/ Total Quality Management)
(. emloyee oyee mora morale le may may su$$er su$$er.. D. all o$ t#e a!ove a!ove..
D. insectin insectingg roducts roducts during during roduction roduction *.
Prevention cost *4. (osts incurred incurred to imrove imrove roduct roduct uality !y recluding recluding roduct roduct de$ects are no%n as' as' A. internal $ailure costs costs (. araisal costs costs ). e3ter e3ternal nal $ailu $ailure re costs costs D. re reve venti ntion on cos costt *6. +orer +orer training ning is a>n? a>n? A. araisal cost. cost. ). e3ter e3ternal nal $ailu $ailure re cost. cost.
(. internal $ailure cost. cost. D. re reve venti ntion on cos cost. t.
*7. An e3amle o$ a control control cost cost is' A. sulier evaluation evaluation and selection selection ). scra scra
(. cost o$ recallin recallingg roducts roducts D. all all o$ t#e t#e a!ov a!ovee
Analysis . $ a comany comany #as #ig# $ailure costs& costs& t#e !est course o$ action to reduce total uality uality costs %ould !e to increase A. revention costs costs (. t#e cost o$ non-comliance non-comliance ). t#e costs costs assoc associated iated %it# %it# comlia comliance nce D. arai araisal s al costs costs
0on-value added costs 2. T#e costs caused caused !y ine$$iciency ine$$iciency in revention revention activities are' A. nonvalued nonvalued-added -added costs ). value value-ad -adde dedd costs costs (. neit#er nonvalued-added nonvalued-added or value-added value-added costs costs D. !ot# nonvalue nonvalued-ad d-added ded or value-adde value-addedd costs
Araisal cost cost *8. T#e uality costs t#at are incurred incurred to determine determine %#et#er %#et#er articular articular units o$ roduct roduct meet uality standards are A. araisal costs. costs. (. internal internal $ailure $ailure costs. costs. ). e3ternal $ailure costs. D. revention costs.
1
etters (omany (omany manu$actured manu$actured 1::&::: 1::&::: motors motors $or de#umidi$iers de#umidi$iers and and used *:&::: direct direct la!or #ours. T#e selling rice o$ eac# motor is P*4 and t#e la!or cost is P1: er #our. T#e la!or roductivity ratio is' A. P1: (. 2 motors er #our #our ). P1*.4: D. *.4 motors motors er #our #our
*
At the end of 2006, 2006, Duabi Duabi Corpo Corporat ration ion implem implement ented ed a new labor labor process process and redesigned redesigned its product product with the expectati expectation on that input usage efficiency efficiency would increase. Now, at the end of 200, the president of the company wants an assessment of the changes on the company!s producti"ity. producti"ity. #he data needed for the assessment are as follows$ *::6 *::7 Outut :&::: 8 &: : : Outut rices P1* P1*
.
nternal $ailure cost *9. T#e cost o$ do%ntime on mac#ines mac#ines %#ile re%or is !eing er$ormed er$ormed is a>n? A. araisal cost. cost. (. int intern ernal al $ailure u re cost. cost. ). e3ternal $ailure cost. D. revention cost. :. T#e costs o$ re%oring re%oring de$ective units to mae t#em salea!le are classi$ied classi$ied as A. araisal costs (. inte interna rnall $ailur $ailuree costs costs ). e3ternal $ailure costs D. revention costs
.
E3ternal $ailure cost 1. +#ic# o$ t#e $ollo%ing $ollo%ing reresents an an e3ternal $ailure cost, cost, A. rerocessing rerocessing a de$ective roduct roduct !e$ore s#iment s#iment ). relacing acing a de$ective ve roduct roduct a$ter a$ter s#iment s#iment (. #iring #iring $or ualit ualityy
59
Cost Accounting Systems (D. Product Quality and Productivity/ Total Quality Management)
Cost Accounting Systems (D. Product Quality and Productivity/ Total Quality Management)
(. emloyee oyee mora morale le may may su$$er su$$er.. D. all o$ t#e a!ove a!ove..
D. insectin insectingg roducts roducts during during roduction roduction *.
Prevention cost *4. (osts incurred incurred to imrove imrove roduct roduct uality !y recluding recluding roduct roduct de$ects are no%n as' as' A. internal $ailure costs costs (. araisal costs costs ). e3ter e3ternal nal $ailu $ailure re costs costs D. re reve venti ntion on cos costt *6. +orer +orer training ning is a>n? a>n? A. araisal cost. cost. ). e3ter e3ternal nal $ailu $ailure re cost. cost.
(. internal $ailure cost. cost. D. re reve venti ntion on cos cost. t.
*7. An e3amle o$ a control control cost cost is' A. sulier evaluation evaluation and selection selection ). scra scra
(. cost o$ recallin recallingg roducts roducts D. all all o$ t#e t#e a!ov a!ovee
Analysis . $ a comany comany #as #ig# $ailure costs& costs& t#e !est course o$ action to reduce total uality uality costs %ould !e to increase A. revention costs costs (. t#e cost o$ non-comliance non-comliance ). t#e costs costs assoc associated iated %it# %it# comlia comliance nce D. arai araisal s al costs costs
0on-value added costs 2. T#e costs caused caused !y ine$$iciency ine$$iciency in revention revention activities are' A. nonvalued nonvalued-added -added costs ). value value-ad -adde dedd costs costs (. neit#er nonvalued-added nonvalued-added or value-added value-added costs costs D. !ot# nonvalue nonvalued-ad d-added ded or value-adde value-addedd costs
Araisal cost cost *8. T#e uality costs t#at are incurred incurred to determine determine %#et#er %#et#er articular articular units o$ roduct roduct meet uality standards are A. araisal costs. costs. (. internal internal $ailure $ailure costs. costs. ). e3ternal $ailure costs. D. revention costs.
1
etters (omany (omany manu$actured manu$actured 1::&::: 1::&::: motors motors $or de#umidi$iers de#umidi$iers and and used *:&::: direct direct la!or #ours. T#e selling rice o$ eac# motor is P*4 and t#e la!or cost is P1: er #our. T#e la!or roductivity ratio is' A. P1: (. 2 motors er #our #our ). P1*.4: D. *.4 motors motors er #our #our
*
At the end of 2006, 2006, Duabi Duabi Corpo Corporat ration ion implem implement ented ed a new labor labor process process and redesigned redesigned its product product with the expectati expectation on that input usage efficiency efficiency would increase. Now, at the end of 200, the president of the company wants an assessment of the changes on the company!s producti"ity. producti"ity. #he data needed for the assessment are as follows$ *::6 *::7 Outut :&::: 8 &: : : Outut rices P1* P1*
.
nternal $ailure cost *9. T#e cost o$ do%ntime on mac#ines mac#ines %#ile re%or is !eing er$ormed er$ormed is a>n? A. araisal cost. cost. (. int intern ernal al $ailure u re cost. cost. ). e3ternal $ailure cost. D. revention cost. :. T#e costs o$ re%oring re%oring de$ective units to mae t#em salea!le are classi$ied classi$ied as A. araisal costs (. inte interna rnall $ailur $ailuree costs costs ). e3ternal $ailure costs D. revention costs
.
E3ternal $ailure cost 1. +#ic# o$ t#e $ollo%ing $ollo%ing reresents an an e3ternal $ailure cost, cost, A. rerocessing rerocessing a de$ective roduct roduct !e$ore s#iment s#iment ). relacing acing a de$ective ve roduct roduct a$ter a$ter s#iment s#iment (. #iring #iring $or ualit ualityy
59
Cost Accounting Systems (D. Product Quality and Productivity/ Total Quality Management)
Materials >l!s.? 1 : &: : : 1 : &2 : : Materials unit rice P8 P7 Ca!or #ours 1 2 &: : : 1 4 &: : : Ca!or rate er #our P6 P7 Po%er >%H? 1 * &: : : 1 &: : : Price er %H P P2 )y #o% muc# did ro$its c#ange as a result o$ roductivity c#anges in materials, A. P 1&::: decrease (. P *&2:: decrease ). P 14 14&87 &87:: inc incre reas asee D. P *:&8:: *:&8:: increa increase se
+arranty reairs Total uality costs
.
4
.
.
At the end end of 2006 2006,, Alba Alban n Comp Compan any y impl implem emen ente ted d a new new labo laborr proce process ss and and redesigned redesigned its product product with the expectatio expectation n that input usage efficiency efficiency would would increase. Now, at the end of 200, the president of the company wants an assessment of the changes on the company!s producti"ity. producti"ity. #he data needed for the assessment are as follows$ *::6 *::7 Outut 1 : &: : : 1 * &: : : Outut rices P1: P1: (#ange in ro$its P1:&7:: Pro$it-lined measurements' Ma Materials P2&6:: Ca Ca!or &*4: Po%er >*4:? 0et P7&6:: Ho% muc# is t#e rice-recovery comonent, A. P &1:: (. P 1: 1: &7 &7 :: :: ). P> P > 1 & 4 : ? D. P 7&6::
Testing Re%or Training Product lia!ility insurance Quality lanning (ustomer surveys Reinsection and retesting
4:&::: P*9&:::
6
.
P 6:&::: *7&4:: 24&::: 4&::: 2&::: 14&::: 17&4:: 60
+#at is t#e t#e amoun amountt o$ araisa araisall costs, costs, A. P6:&::: ) . P9 *& *& 4: 4::
(. P*&4:: D. P 74 74 &: &:: :
+#at is t#e amount amount o$ e3tern e3ternal al $ailure lure costs costs,, A. P4&::: ) . P8 4& 4& :: :::
(. P4:&::: D. P 67 67 &4 &4: :
$ urt (omany (omany is a!le to reduce uality uality costs costs to *.4 ercent ercent o$ sales& es& %#at %#at %ill #aen #aen to ro$its, A. Decrease !y P*4&::: (. Decrease !y P*9&::: ). nc ncrea rease se !y P*68 P*68&:: &:::: D. ncrea ncrease se !y P*4&:: P*4&::::
Cost Accounting Systems (D. Product Quality and Productivity/ Total Quality Management)
Materials >l!s.? 1 : &: : : 1 : &2 : : Materials unit rice P8 P7 Ca!or #ours 1 2 &: : : 1 4 &: : : Ca!or rate er #our P6 P7 Po%er >%H? 1 * &: : : 1 &: : : Price er %H P P2 )y #o% muc# did ro$its c#ange as a result o$ roductivity c#anges in materials, A. P 1&::: decrease (. P *&2:: decrease ). P 14 14&87 &87:: inc incre reas asee D. P *:&8:: *:&8:: increa increase se
+arranty reairs Total uality costs
.
4
.
.
At the end end of 2006 2006,, Alba Alban n Comp Compan any y impl implem emen ente ted d a new new labo laborr proce process ss and and redesigned redesigned its product product with the expectatio expectation n that input usage efficiency efficiency would would increase. Now, at the end of 200, the president of the company wants an assessment of the changes on the company!s producti"ity. producti"ity. #he data needed for the assessment are as follows$ *::6 *::7 Outut 1 : &: : : 1 * &: : : Outut rices P1: P1: (#ange in ro$its P1:&7:: Pro$it-lined measurements' Ma Materials P2&6:: Ca Ca!or &*4: Po%er >*4:? 0et P7&6:: Ho% muc# is t#e rice-recovery comonent, A. P &1:: (. P 1: 1: &7 &7 :: :: ). P> P > 1 & 4 : ? D. P 7&6::
Testing Re%or Training Product lia!ility insurance Quality lanning (ustomer surveys Reinsection and retesting
4:&::: P*9&:::
6
.
+#at is t#e t#e amoun amountt o$ araisa araisall costs, costs, A. P6:&::: ) . P9 *& *& 4: 4::
(. P*&4:: D. P 74 74 &: &:: :
+#at is t#e amount amount o$ e3tern e3ternal al $ailure lure costs costs,, A. P4&::: ) . P8 4& 4& :: :::
(. P4:&::: D. P 67 67 &4 &4: :
$ urt (omany (omany is a!le to reduce uality uality costs costs to *.4 ercent ercent o$ sales& es& %#at %#at %ill #aen #aen to ro$its, A. Decrease !y P*4&::: (. Decrease !y P*9&::: ). nc ncrea rease se !y P*68 P*68&:: &:::: D. ncrea ncrease se !y P*4&:: P*4&::::
P 6:&::: *7&4:: 24&::: 4&::: 2&::: 14&::: 17&4:: 60
%
. Ans%er' ) Ca!or roductivity ratios are oerational measure >1::&:::/*:&::: 4 motors er #our? or $inancial measure I>*4 J 1::&:::?/>*:&::: J 1:? P1*.4:?.
2
.
Ans%er' ) Mat Mater eria iall ro roduc ductivit ivityy rat ratio& *::6' ::6' >:& :&::: ::: K 1:&: :&:::? ::? Actual materials material s >l!s?& *::7 1:&2:: Reuired l!s. !ased on *::6' >8&::: K ? 1*&667 *&*67 3 P7? P14&87:
&
.
Ans%er' A Price recovery comonent' (#ange in Pro$its' Dedu Deduct ct ro$ ro$itit-l -lin ine edd rod roduc uctitivi vity ty c#an c#ange ge Price recovery comonent
'
(
6
.
.
P1:&7:: 7&6: 7&6::: P &1::
Ans%er' D Testing (ustomer surveys Total araisal costs
P6:&::: 14&::: P74&:::
Ans%er' ) Product lia!ility insurance +arranty reairs Total e3ternal costs
P4&::: 4:&::: P84&:::
Ans%er' )
%
. Ans%er' ) Ca!or roductivity ratios are oerational measure >1::&:::/*:&::: 4 motors er #our? or $inancial measure I>*4 J 1::&:::?/>*:&::: J 1:? P1*.4:?.
2
.
Ans%er' ) Mat Mater eria iall ro roduc ductivit ivityy rat ratio& *::6' ::6' >:& :&::: ::: K 1:&: :&:::? ::? Actual materials material s >l!s?& *::7 1:&2:: Reuired l!s. !ased on *::6' >8&::: K ? 1*&667 *&*67 3 P7? P14&87:
&
.
Ans%er' A Price recovery comonent' (#ange in Pro$its' Dedu Deduct ct ro$ ro$itit-l -lin ine edd rod roduc uctitivi vity ty c#an c#ange ge Price recovery comonent
'
(
6
.
.
.
P1:&7:: 7&6: 7&6::: P &1::
Ans%er' D Testing (ustomer surveys Total araisal costs
P6:&::: 14&::: P74&:::
Ans%er' ) Product lia!ility insurance +arranty reairs Total e3ternal costs
P4&::: 4:&::: P84&:::
Ans%er' ) (urrent uality costs Cess roosed uality costs' >:. >:.:*4 3 P1M? (ost savings >increase in ro$its?
P*9&::: *4&::: P*68&:::
