1.

A technique used to monitor jobs in process is the

a) Johnson's rule.
b) Gantt load chart.
c) Gantt schedule chart.
d) Assignment method.
2. Shop loading

a) means the assignment of jobs to work or processing centers.

b) means the assignment of dates to specific jobs or operations steps.
c) is oriented toward the management of work-in-process inventories.
d) is typically managed using an assembly chart.
3. Which of the following dispatch rules tends to maximize the number of jobs completed on time?

a) LPT: Longest processing time

b) EDD: Earliest due date
c) SPT: Shortest processing time
d) FCFS: First come, first served
4. Which of the following dispatch rules tends to minimize the average number of jobs in the
system?

a) EDD: Earliest due date

b) LPT: Longest processing time
c) FCFS: First come, first served
d) SPT: Shortest processing time
5. Of the following dispatching rules, which is considered to be dynamic?

a) SPT: Shortest processing time

b) EDD: Earliest due date
c) FCFS: First come, first served
d) CR: Critical ratio
6. The theory of constraints pays special attention to
a. the number of part-time employees.
b. cost of materials.
c. the nature of the individual in charge of scheduling.
d. bottleneck operations.
7. Use the EDD dispatching rule to sequence the following jobs.
8.

Job
Work time (days)
Due date (days)

e. A
f. 19
g. 20

h. B
i. 10
j. 25
 k. C
l. 12
m. 30

n. D
o. 7
p. 8

q. E
r. 6
s. 12
A, C, B, D, E

D, E, A, B, C

E, D, B, C, A

A, B, C, D, E

9. Use the SPT dispatching rule to sequence the following jobs.

Job Work time (days) Due date (days)

A 19 20
B 10 25
C 12 30
D 7 8
 E 6 12
A, C, B, D, E

A, B, C, D, E

D, E, A, B, C

E, D, B, C, A

10. Use the LPT dispatching rule to sequence the following jobs.

Job Work time (days) Due date (days)

A 19 20
B 10 25
C 12 30
D 7 8
E 6 12
A, C, B, D, E

A, B, C, D, E

E, D, B, C, A

D, E, A, B, C

11. Jobs are processed on a FCFS basis in the order shown in the table. What is the average number
of jobs in the system?

12. Processing
Job Due Date
Time
A 5 12

B 7 15

C 8 25

D 3 6

E 4 30
F 6 20
a. 2.41

b. 0.91

c. 4.56

d. 3.64

13. A bottleneck is

a. a job that flows through the system the fastest.

b. a work center that has the least number of jobs flowing through it.
c. a work center that has less capacity than prior and following work centers.
d. a job that takes the greatest amount of time to process.
14. Which of these statements regarding service scheduling is best?

a. Inventories can be used to smooth demand just like in manufacturing.

b. Demand for labor is stable in a service system.
c. Behavioral, social, and status issues are important in scheduling labor.
d. Scheduling emphasis is on machines and material.
15. Level material use is advantageous because

a. it releases capital for other uses.

b. lead times are increased, allowing a plant to take more care in preparing an order.
c. defective material is not an issue since there is plenty of inventory to choose from.
d. less floor space is wasted due to increased levels of inventory.

16. Six jobs must be processed first on Machine 1 and then on Machine 2. Which sequence will
result in the fastest average processing time for all jobs?

Machine
Job Machine 2
1
A 6 11
B 6 5
C 12 8
D 12 14
E 11 7
F 9 10
E, F, C, A, D, B

B, C, F, E, A, D

F, A, C, E, D, B
 A, F, D, C, E, B

17. When using the critical ratio (CR) to develop a sequence

a. a CR of greater than 1.0 means that the job has some slack.
b. a CR of 1.0 means that the job should be scheduled first.
c. a CR of less than 1.0 means that the job is ahead of schedule.
d. a CR of 1.0 means that the job should be scheduled last.
18. What does MPS focuses on
a. MRO
b. WIP
c. FG
d. RM
19. What characterizes on Gant.Chat?
a. Relates interdependent activities to their completion time
b. is used to schedule independent activities
c. represents an important events in the completion of a project.
d. use foot stone and inch stone to represent events lesser importance.
20. What is the aim for development of Master Schedule?
a. Assemble product continuous production
b. single product continuous production
c. Multiproduct batch production
d. single product batch production
21. What does not contributes to increase in production plant capacity?
a. increase the backlog before each machine
b. the purchase of additional equipment
c. larger production lot size
d. Scheduled machine maintenance

ERP MCQ with solutions

Multiple Choice Questions

SECTION 1

1.  Which of the following describes an ERP system?

A)  ERP systems provide a foundation for collaboration between departments

B)  ERP systems enable people in different business areas to communicate

C)  ERP systems have been widely adopted in large organisations to store critical knowledge
used to make the decisions that drive the organisation's performance

D)  All of the above

Answer: D  
Response: All of the above describe ERP systems.

2.  What is at the heart of any ERP system?

A)  Information

B)  Employees

C)  Customers

D)  Database

Answer: D   

Response: At the heart of an ERP system is a central database.

3.  What must a system do to qualify as a true ERP solution?

A)  Be flexible

B)  Be modular and closed

C)  Extend within the company

D)  All of the above

Answer: A   Level: Medium      

Response: To qualify as a true ERP solution the system must be flexible, modular and open, and
extend beyond the company.

4.  Which of the following is a reason for ERPs explosive growth?

A)  ERP is a logical solution to the mess of incompatible applications

B)  ERP addresses the need for global information sharing and reporting

C)  ERP is used to avoid the pain and expense of fixing legacy systems

D)  All of the above

Answer: D  

Response: All of the above are reasons for ERPs explosive growth.
5.  Which of the following occurs when everyone involved in sourcing, producing, and delivering
the company's product works with the same information?

A)  Eliminates redundancies

B)  Cuts down wasted time

C)  Removes misinformation

D)  All of the above

Answer: D  

Response: All of the above occur due to the use of an ERP system.

6.  What are several different types of software, which sit in the middle of and provide
connectivity between two or more software applications?

A)  Middleware

B)  Enterprise application integration middleware

C)  Automated business process

D)  e-business infrastructure

Answer: A     

Response: This is the definition of middleware.

7.  What represents a new approach to middleware by packaging together commonly used
functionality, such as providing prebuilt links to popular enterprise applications, which reduces
the time necessary to develop solutions that integrate applications from multiple vendors?

A)  Middleware

B)  Enterprise application integration middleware

C)  Automated business process

D)  e-business infrastructure

Answer: B  

Response: This is the definition of enterprise application integration middleware.

8.  Who are the primary users of SCM systems?

A)  Sales, marketing, customer service

B)  Accounting, finance, logistics, and production

C)  Customers, resellers, partners, suppliers, and distributors

D)  All of the above

Answer: C  

Response: The primary users of SCM systems are customers, resellers, partners, suppliers, and
distributors.

9.  What are the primary business benefits of an ERP system?

A)  Sales forecasts, sales strategies, and marketing campaigns

B)  Market demand, resource and capacity constraints, and real-time scheduling

C)  Forecasting, planning, purchasing, material management, warehousing, inventory, and

distribution

D)  All of the above

Answer: C  

Response: The primary business benefits of an ERP system include forecasting, planning,
purchasing, material management, warehousing, inventory, and distribution.

10.  Who are the primary users of ERP systems?

A)  Sales, marketing, customer service

B)  Accounting, finance, logistics, and production

C)  Customers, resellers, partners, suppliers, and distributors

D)  All of the above

Answer: B  

Response: The primary users of ERP systems are accounting, finance, logistics, and production.

1. _________ handling and sharing has become a vital process for efficient and effective
working of any organisation.
 a.  Material

b.  Resource

c.  Information

d.  Database

2. ________ became the fundamental concept of production management and control.

a.  BOM

b.  MRP

c.  ERP

d.  MRP II

3. In the _________, ERP packages were targeted at the manufacturing industry.

a.  1970’s

b.  1990's

c.  1980’s

d.  1960’s

4. The _________ should plan well and execute perfectly the implementation of ERP.

a.  Organisation

b.  System developers

c.  Vendors

d.  Top Management

5. Which is one of the most critical steps in the ERP implementation?

a.  Creation of Organisational Model

b.  Creation of Integrated Data Model

c.  Creation of Business Model

d.  Creation of Data Model

 6.    What is one of the key resources of every organisation, in today’s competitive business
environment?

a.  Employee

b.  Information

c.  ERP

d.  Database

7.    When a customer needs to check the performance of the company before he places an
order, which department has to be in a position to provide the necessary information?

a.  Production

b.  Quality

c.  Marketing

d.  Finance

8.    In an integrated data model, what gives a snapshot of the organisation at any given time?

a.  ERP

b.  Database

c.  Management

d.  MIS

9.    OLAP stands for:

a.  On-Line Analytical Processing

b.  On-Line Account Processing

c.  On-Line Arithmetic Processing

d.  On-Line Application Processing

10. Data mining is the process of identifying valid, new, potentially useful, and ultimately clear
______________ from databases.
 a.  Decision

b.  Strategies

c.  Information

d.  Account

11. EIS stands for:

a.  Executive Interaction System

b.  Executive Interconnecting Systems

c.  Executive Information Systems

d.  Executive Instrumental Systems

12. DSS is quite _______________ and is available on request.

a.  Structured

b.  Non-structured

c.  Semi-structured

d.  Unstructured

13. ERP system is built on a ____________ utilising a common computing platform

a.    Centralised database

b.    Individual databases

c.   Modular databases

d.    Centralised layout

14. Which of the following is an example for commercial ERP

a.  ERP5

b.  Microsoft Dynamics AX

c.  Compiere

d.  Fisterra

15. NPV is the abbreviation of

a.  Net Present Variation method

b.  Net Present Value method

c.  Neutral Present Value method

d.  Net Preventive Value method

16. ERP vendors usually design their systems around standard business processes, based upon
____________________

a.  Business standards

b.  Global standards

c.  Best business practices.

d.  Best profitable standards

17. The _______ module's internal functions do not directly interact with the data or processes
of other modules.

a.  Finance

b.  Quality Management

c.  Sales and Distribution

d.  Plant Maintenance

18. Which among the following systems can be assigned to a cost centre directly which
illustrates the interface to the cost accounting system?

a.  FAPA

b.  Purchasing

c.  Sales and Distribution

d.  CASO

19. Which system provides the foundation for creating concurrent business processes across the
supply chain and achieving Return on Assets (ROA) improvement?
 a.  Finance

b.  Inventory

c.  Manufacturing

d.  Sales

20. The processes described in the quality manual can be implemented and automated in the
EDP system. Here what does EDP stand for?

a.  Electronic Data Processing

b.  Electronic Dictionary Project

c.  Electrical Data Processing

d.  Employee Development Plan

21. What is the key to MRP?

a.    Quantity of requirements for components are based upon the structure of the Bill of
Material.

b.    Production of requirements for components are based upon the structure of the Bill of
Material.

c.    Time-phasing of requirements for components are based upon the structure of the Bill of
Material.

d.    Capacity of requirements for components are based upon the structure of the Bill of
Material.

22. During the 80s, tools were developed to assist the planning of:

a.  Production levels

b.  Priority planning system

c.  Capacity requirements

d.  Planning functions

23. Complete the sentence: MRP-II systems provide…

a.    Information that is useful to all functional areas and encourage cross-functional interaction.
 b.  Information with cost data.

c.  Information that can be used for other company functions.

d.  Accurate inventory information.

24. ERP is restricted to being a _________operations system in the country.

a.     Finance

b.     Budgeting modules

c.     Manufacturing

d.     Transaction-oriented

25. ________________ allow companies to enter requirements for various types of items.

a.  Purchase order

b.  Purchase requisitions

c.  Invoice

d.  General ledger

26. What is EDI?

a.    Electronic Data Interface

b.    Exchange Data Interchange

c.   Exchange Data Interface

d.  Electronic Data Interchange

27. _________ module supports the entire sales and purchase processes from start to finish.

a.  Order management

b.  Sales management

c.  Purchase management

d.  Master Data Management

28. ___________evaluates whether or not customer contract agreement are being met.

a.  Purchase order management

b.  Sales order management

c.  Master data management

d.  Warehouse management

29. ____________ maintains reports of warehouse supplies.

a.  ERP financial module

b.ERP Inventory software module

c.  ERP Resource module

d.  ERP verification module

30. Web ERP is suitable for ____________ .

a.  Both small and big organisations

b.  Only big organisations

c.  Medium scale organisations

d.  Only small organisations

31. RFP stands for ____________________ .

a.  Request For Productivity

b.  Request For Profits

c.  Request For Processing

d.  Request For Proposal

32. Installing ERP Inventory systems is  ____________ .

a.  Simple

b.  Trouble free

c.  Complex

d.  Cost effective

33. In recent years, CRM has become a primary component of:

a.    ERP vendors

b.  ERP software solutions.

c.  CRM software

d.  CRM solutions

34. ____________is the most common operating system for running CRM software

a.  UNIX

b.    Windows NT

c.   Windows Vista

d.    Windows XP
35. __________ module keeps track of liquidation process.

a.  Market management module

b.  Liquidation module

c.  Treasury module

d.  Enterprise management module

36. ____________ system maintains employees information in graphical format.

a.  Employee master data

b.  Personnel administration

c.  Payroll accounting

d.  Benefits administration
37. As processes become more automated and efficient,

a.  It is best to treat ERP as an investment as well as a cost-cutting measure.

b.  It is not best to treat ERP as an investment as well as a cost-cutting measure.

c.  It is best to treat ERP as an disinvestment as well as a cost-cutting measure.

d.  It is best to treat ERP as an investment but not as a cost-cutting measure.

38. ETO means

a.  Engineer-to-Order
b.  Engineer-to-Offer

c.  Enterprise-to-Order

d.  Enterprise-to-Offer

39. The vendor should have a _______, who must constantly interact with the
implementation team.

a.  Liaison officer

b.  Project Supervisor

c.  Project Manager

d.  Implementation co-ordinator

40. Identify the correct statement.

a.  The only problem with the package vendors is that they are very expensive.

b.  The only problem with the business consultants is that they are very expensive.

c.  The only problem with the employee training is that it is very expensive.

d.  The only problem with the planning of implementation is that it is very expensive.
Ans:
Questios:

1. In the theory of constraints, throughput refers to

a. sales dollars less direct materials and direct labor costs.

b. sales dollars less direct materials costs.
c. sales dollars less variable cost of goods sold.
d. the cost of total production output.
e. the cost of good production output.

2. In the theory of constraints, the pace of a non-bottleneck production operation is

controlled by the pace of

a. the previous (upstream) operation.

b. the next (downstream) operation.
c. a bottleneck operation.
d. another non bottleneck operation.
e. the team leader.

3. One of the key ideas in Goldratt's theory of constraints is to maximize throughput

by

a. balancing the production line, i.e., equal capacity at each operation.

b. balancing the flow of work in the plant.
c. maximizing production at each operation.
d. a and b.
e. all of these.

4. An objective in the theory of constraints is to

a. balance the capacity of each operation in the plant so that all operations will
produce at the same pace.
b. balance the flow of work by allowing the most binding constraint to set the
pace for the plant.
c. balance the capacity of each operation by recognizing the variability within
the system.
d. balance the flow of work by allowing each operation to produce at it’s own
pace.
e. none of the above.
5. The drum in a theory of constraints system

a. enforces the pace.

b. authorizes production.
c. protects the pace.
d. sets the pace.
e. none of these.

6. The rope in a theory of constraints system

a. enforces the pace.

b. authorizes production.
c. protects the pace.
d. sets the pace.
e. none of these.

7. The buffer in a theory of constraints system

a. enforces the pace.

b. authorizes production.
c. protects the pace.
d. sets the pace.
e. none of these.

8. In a theory of constraints system, throughput is

a. the money flowing into the system.

b. the money flowing out of the system.
c. the money in the system.
d. sales dollars.
e. none of these.

9. In the theory of constraints, throughput is

a. sales dollars less direct materials related to the units sold.

b. money flowing into the system.
c. all the money in the system.
d. a. and b.
e. a. and c.

10. In the theory of constraints, a constraint is

 a. a policy that limits throughput.
b. an activity or operation that limits throughput.
c. a scarce resource that limits throughput.
d. a. and b.
e. a., b. and c.

11. A bottleneck is where

a. the demand on a resource is greater than the capacity of the resource.

b. the demand on a resource is equal to the capacity of the resource.
c. buffer inventory should be avoided.
d. a. and b.
e. a., b. and c.

12. In the theory of constraints, inventory includes

a. direct materials.
b. assets.
c. all the money in the system.
d. b. and c.
e. a., b. and c.

13. When comparing the return of investment calculations in throughput accounting

and GAAP accounting, which of the following will be different when the amount of
inventory changes?

a. Net income.
b. The capital turnover ratio.
c. The margin, or return on sales.
d. a. and c.
e. a., b. and c.

14. According to Goldratt, floating bottlenecks are created by

a. dependent events.
b. statistical fluctuations.
c. attempts to balance the plant.
d. the combination of a., b. and c.
e. none of the above.

15. According to the theory of constraints, a non-constraint is utilized when

 a. it is producing at capacity.
b. when it is activated.
c. when it is producing throughput.
d. a. and b.
e. a. and c.

16. In the theory of constraints, balancing the flow of work requires

a. breaking the constraint.

b. working at the pace set by the constraint.
c. balancing the plant.
d. a. and b.
e. a., b. and c.

17. Using Goldratt’s "evaporating cloud" technique refers to

a. identifying a faulty assumption in a conflict or issue.

b. breaking the constraint in a system.
c. identifying the constraint in a system.
d. compromise.
e. none of the above.

18. Goldratt is opposed to

a. product costing.
b. financial measurements.
c. cost variances.
d. a. and c.
e. a., b. and c.

19. In the theory of constraints, the goal is

a. to maximize throughput.
b. to balance the flow of work.
c. to make money now and in the future.
d. to minimize inventory and operating expense.
e. none of the above.

20. Throughput is

a. money generated by the company.

b. Sales.
 c. Sales - operating expense.
d. Sales - inventory.
e. None of these.

21. In TOC, operating expense excludes

a. direct labor cost.

b. direct material cost.
c. variable factory overhead cost.
d. fixed factory overhead cost.
e. selling and administrative cost.

22. In the theory of constraints, inventory is defined as

a. direct materials included in the products sold.

b. total assets.
c. assets - liabilities.
d. sales - throughput.
e. none of the above.

23. In the theory of constraints, decreasing inventory (as defined in TOC) without
affecting throughput or operating expense, would automatically

a. increase net income.

b. decrease net income.
c. increase return on investment.
d. decrease return on investment.
e. produce none of the above.

24. According to Goldratt, floating bottlenecks are caused by the combination of

a. an unbalanced plant, constraints and dependent events.

b. a balanced plant, constraints and statistical fluctuations.
c. an unbalanced plant and statistical fluctuations.
d. a balanced plant, dependent events and statistical fluctuations.
e. an unbalanced plant, dependent events and statistical fluctuations.

25. In the theory of constraints, a non-bottleneck operation producing at it’s own pace
would

a. always be activated and always be utilized.

b. always be activated, but not always utilized.
 c. always be utilized, but not always activated.
d. always be producing throughput.
e. none of the above.

26. In the drum-buffer-rope method, material inventory buffers are placed

a. in the warehouse.
b. directly downstream from the drum.
c. directly upstream from the rope.
d. directly upstream from the drum.
e. directly downstream from the rope.

27. According to the theory of constraints, which of the following is, or are, global
measurements

a. traditional product costs.

b. activity based product costs.
c. throughput.
d. all of the above.
e. none of the above.

28. In the theory of constraints, the goal is

a. to maximize throughput.
b. to balance the flow of work.
c. to exploit the constraints.
d. to minimize inventory and operating expense.
e. none of the above.

29. ROI in the theory of constraints is

a. money generated by the company divided by inventory.

b. (Sales - COGS)/Inventory.
c. (Sales - operating expense)/Inventory.
d. (Throughput - operating expense)/Inventory.
e. None of these.

30. In TOC, operating expense excludes

a. direct labor cost.

b. variable factory overhead cost.
c. fixed factory overhead cost.
 d. selling and administrative cost.
e. None of these.

31. In the theory of constraints, product inventory (i.e., inventory in traditional

accounting) includes

a. direct materials.
b. direct product costs.
c. assets.
d. sales - throughput.
e. none of the above.

32. In the theory of constraints, which of the following represent assets?

a. direct materials.
b. direct labor
c. factory overhead
d. selling costs
e. a, b and c.

33. In the theory of constraints, increasing inventory (as defined in TOC) without
affecting throughput or operating expense, would automatically

a. increase net income.

b. decrease net income.
c. increase return on investment.
d. decrease return on investment.
e. produce none of the above.

34. When finished goods inventory increases, (i.e., where the number of products sold
is less than the number of products produced) net income based on throughput costing

a. will be greater than net income based on either absorption costing or direct
costing.
b. will be less than net income based on either absorption costing or direct
costing.
c. will be greater than net income based on absorption costing, but equal to
direct costing net income.
d. will be greater than net income based on direct costing, but equal to
absorption costing net income.
e. none of the above.
35. According to the theory of constraints, which of the following is not, or are not
global measurements?

a. traditional product costs.

b. activity based product costs.
c. throughput.
d. a and b.
e. b and c.

36. The dice game or match bowl experiment was designed to show that

a. workers tend to control their own performance.

b. special or assignable causes account for most of the variation in performance.
c. common or random causes account for most of the variation in performance.
d. a balanced plant is not obtainable.
e. a and c.

37. Goldratt’s main criticism of the "cost mentality" is that

a. product costs are too distorted, too aggregated and provided too late for
management’s needs.
b. thinking in terms of costs motivates managers to optimize the parts of a
system rather than the whole.
c. product costs are generated from accounting systems that represent the main
barrier to improvement.
d. there is no such thing as product costs.
e. product costs are not needed for pricing products and services.

38. A technique associated with the theory of constraints is referred to as the drum-
buffer-rope method. In this method the most binding constraint is the

a. buffer
b. rope
c. drum
d. a and c
e. none of these.

39. Which term (or terms) below is (are) associated with floating bottlenecks?

a. dependent events
b. independent events.
c. statistical fluctuations
 d. b and c.
e. a and c.

40. Which of the following concepts or philosophies tend to promote more product
diversity?

a. TOC
b. ABC
c. JIT
d. a and b
e. a and c.

Answer:

1.In the theory of constraints, throughput refers to

b. sales dollars less direct materials costs.

2. In the theory of constraints, the pace of a non-bottleneck production operation is

controlled by the pace of

c. a bottleneck operation.

3. One of the key ideas in Goldratt's theory of constraints is to maximize throughput

by

b. balancing the flow of work in the plant.

4. An objective in the theory of constraints is to

b. balance the flow of work by allowing the most binding constraint to set the
pace for the plant.

5. The drum in a theory of constraints system

d. sets the pace.

6. The rope in a theory of constraints system

a. enforces the pace.

7. The buffer in a theory of constraints system

c. protects the pace.

8. In a theory of constraints system, throughput is

a. the money flowing into the system.

9. In the theory of constraints, throughput is

d. a. and b.

10. In the theory of constraints, a constraint is

e. a., b. and c.

11. A bottleneck is where

d. a. and b.

12. In the theory of constraints, inventory includes

e. a., b. and c.

13. When comparing the return of investment calculations in throughput accounting

and GAAP accounting, which of the following will be different when the amount of
inventory changes?

e. a., b. and c.

14. According to Goldratt, floating bottlenecks are created by

d. the combination of a., b. and c.

15. According to the theory of constraints, a non-constraint is utilized when

c. when it is producing throughput.

16. In the theory of constraints, balancing the flow of work requires

b. working at the pace set by the constraint.

17. Using Goldratt’s "evaporating cloud" technique refers to

 a. identifying a faulty assumption in a conflict or issue.

18. Goldratt is opposed to

d. a. and c.

19. In the theory of constraints, the goal is

c. to make money now and in the future.

20. Throughput is

a. money generated by the company.

21. In TOC, operating expense excludes

b. direct material cost.

22. In the theory of constraints, inventory is defined as

b. total assets.

23. In the theory of constraints, decreasing inventory (as defined in TOC) without
affecting throughput or operating expense, would automatically

c. increase return on investment.

24. According to Goldratt, floating bottlenecks are caused by the combination of

d. a balanced plant, dependent events and statistical fluctuations.

25. In the theory of constraints, a non-bottleneck operation producing at it’s own pace
would

b. always be activated, but not always utilized.

26. In the drum-buffer-rope method, material inventory buffers are placed

d. directly upstream from the drum.

27. According to the theory of constraints, which of the following is, or are, global
measurements
 c. throughput.

28. In the theory of constraints, the goal is

e. none of the above.

29. ROI in the theory of constraints is

d. (Throughput - operating expense)/Inventory.

30. In TOC, operating expense excludes

e. None of these.

31. In the theory of constraints, product inventory (i.e., inventory in traditional

accounting) includes

a. direct materials.

32. In the theory of constraints, which of the following represent assets?

a. direct materials.

33. In the theory of constraints, increasing inventory (as defined in TOC) without
affecting throughput or operating expense, would automatically

d. decrease return on investment.

34. When finished goods inventory increases, (i.e., where the number of products sold
is less than the number of products produced) net income based on throughput costing

b. will be less than net income based on either absorption costing or direct
costing.

35. According to the theory of constraints, which of the following is not, or are not
global measurements?

d. a and b.

36. The dice game or match bowl experiment was designed to show that

d. a balanced plant is not obtainable.

37. Goldratt’s main criticism of the "cost mentality" is that

b. thinking in terms of costs motivates managers to optimize the parts of a

system rather than the whole.

38. A technique associated with the theory of constraints is referred to as the drum-
buffer-rope method. In this method the most binding constraint is the

c. drum

39. Which term (or terms) below is (are) associated with floating bottlenecks?

e. a and c.

40. Which of the following concepts or philosophies tend to promote more product
diversity?

a. TOC