TABLE 17-4 A Factory Supervisor Is Concerned That the Time It Takes

question 82

Multiple Choice

TABLE 17-4
A factory supervisor is concerned that the time it takes workers to complete an important production task (measured in seconds) is too erratic and adversely affects expected profits. The supervisor proceeds by randomly sampling 5 individuals per hour for a period of 10 hours. The sample mean and range for each hour are listed below.
She also decides that lower and upper specification limit for the critical-to-quality variable should be 10 and 30 seconds, respectively.
-Referring to Table 17-4, suppose the supervisor constructs an chart to see if the process is in-control. What are the lower and upper control limits of this chart?

• A) 10.00, 30.00
• B) 8.49, 32.03
• C) 5.39, 35.13
• D) 4.96, 35.56

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Definitions:

FIFO Assumption

An accounting method where the first items purchased or produced are the first ones used or sold.

LIFO Reserve

The difference in value between inventory calculated using the Last-In, First-Out (LIFO) method and the First-In, First-Out (FIFO) method, used to adjust COGS and inventory valuation.

Cost of Goods Sold

An accounting term for the direct costs attributable to the production of the goods sold by a company, including materials and labor.

FIFO Costs

FIFO (First In, First Out) Costs refer to an accounting method where the goods first added to inventory are the first to be sold.