Which Desirable Action That Managers Take to Relieve Bottleneck Constraints

question 117

Multiple Choice

Which desirable action that managers take to relieve bottleneck constraints of the assembly operation do managers note that the cost of poor quality at a nonbottleneck operation is the cost of materials wasted?

• A)Eliminate idle time at the bottleneck operation.
• B)Shift products that are not made on the bottleneck machine to nonbottleneck machines,or to outside processing facilities.
• C)Reduce setup time and processing time at bottleneck operations.
• D)Improve the quality of parts,or products,manufactured at the bottleneck operation.
• E)Other operating costs will increase,while contribution margin will remain unchanged because bottleneck capacity of the assembly operation will not increase.

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Definitions:

Variable Manuf. Overhead

Costs that vary with the level of production output and are related to the manufacturing process but cannot be directly traced to individual units produced.

Direct Materials

Raw materials that are directly incorporated into a finished product and are easily traceable to it.

Labour Rate Variance

The difference between the actual labor costs incurred and the standard labor costs for the actual production level.

Actual Rate

The actual cost incurred or the price paid for materials, labor, or overhead as opposed to budgeted or standard costs.