If the Values in a Control Chart Follow a Pattern

question 88

Multiple Choice

If the values in a control chart follow a pattern (instead of being random) ,then ______.

• A)we can say that a special cause is present
• B)the process is within control
• C)the operator is out of control
• D)there is excessive common cause variation

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Definitions:

Variable Costing

A costing method in which variable manufacturing costs are included in product costs, while fixed manufacturing costs are treated as period costs.

Absorption Costing

An accounting method that assigns all manufacturing costs, both variable and fixed, to products, thereby impacting the inventory valuation on the balance sheet.

Net Operating Income

The profit a company makes from its operations, calculated as total revenue minus operating expenses, excluding taxes and interest.

Variable Costing

An accounting method that only includes variable production costs—direct materials, direct labor, and variable manufacturing overhead—in product costs.