A major justification for investments in computer-integrated manufacturing CIM) projects is
Answer(s): A
Automating and computerizing production processes requires a substantial investment in fined assets and an increase in risk because of greater fixed costs. CI also necessitates an increase in software costs and extensive worker retraining. However, the costs of spoilage, rework, and scrap are reduced along with labor costs. The qualitative advantages of I are increased flexibility, shorter manufacturing lead time, quicker development of new products, better product delivery and service, faster response to market changes, and improved competitiveness.
A major benefit of computer integrated manufacturing CIM) is
Answer(s): D
CIM entails a holistic approach to manufacturing in which design is translated into product by centralized processing and robotics. CIM can help an organization reduce costs of spoilage, increase flexibility, and increase productivity. Flexibility is the key benefit. A traditional manufacturing system might become disrupted from an emergency change, but CII1 will reschedule everything in the plant when a priority requirement is inserted into the system.
The effect of just-in-time production approaches
Answer(s): B
Just-in-time JIT) production approaches can reduce the cost of production. It lowers or eliminates inventory costs and requires production improvements to eliminate product defects.
A manufacturer uses a materials requirements planning 1RP) system to track inventory, orders, and raw material requirements. A preliminary audit assessment indicates that the organization's inventory is understated. Using audit software, what conditions should the auditor search for in the MRP database to support this hypothesis?I). Item cost set at zero.II). Negative quantities on hand.III). Order quantity exceeding requirements.IV). Inventory lead times exceeding delivery schedule.
If there is no monetary amount in the database for existing inventory, inventory will be understated. Moreover, inadequate edit checks or uncontrolled borrow/paybacks could cause negative quantities to be reported. This condition would cause inventory to be understated. If the amount ordered exceeds requirements, the result is an increase in inventory. However, by itself, this condition would not cause inventory to be understated or overstated. Also, if lead times are longer than delivery times, the effect is an increase in inventory but not necessarily a misstatement.
The internal auditor found that the purchasing department has a policy of setting all purchasing lead times to the highest number of days experienced within each product subassembly}, even though some subassemblies required 3 or more months to complete. To address the objective of reducing inventory holding costs related to this policy, the internal auditor should focus on
A The effect of this policy is to increase inventory holding carrying) costs. Using the longest lead time avoids stockout costs but ensures that many items will be delivered long before they are needed
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