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IIA-CIA-Part3 PDF DEMO:

QUESTION NO: 1
All of the following are generally included in a cost-of-quality report except:
A. Warranty claims.
B. Design engineering.
C. Supplier evaluations.
D. Lost contribution margin.
Answer: D
Explanation:
A cost-of-quality report includes most costs related to quality, specifically the costs of prevention, appraisal, internal failure, and external failure.
11. Which of the following is not an appropriate measure of quality?
A. Market share.
B. Delivery performance.
C. Customer satisfaction.
D. Raw materials costs.
Answer: D
Explanation:
Emphasizing lower input costs may result in more defective output, and higher input costs may or may not reflect the procurement of better raw materials. Financial measures are thus mostly unsuitable for measuring quality.
12. One of the main reasons that implementation of a total quality management (TQM) program works better through the use of teams is:
A. Teams are more efficient and help an organization reduce its staffing.
B. Employee motivation is always higher for team members than for individual contributors.
C. Teams are a natural vehicle for sharing ideas, which leads to process improvement.
D. The use of teams eliminates the need for supervision, thereby allowing a company to reduce staffing.
Answer: C
Explanation:
TQM promotes teamwork by modifying or eliminating traditional (and rigid) vertical hierarchies and instead forming flexible groups of specialists. Quality circles, cross-functional teams, and self-managed teams are typical formats. Teams are an excellent means of encouraging the sharing of ideas and removing process improvement obstacles.
13. If a company is customer-centered, its customers are defined as:
A. Only people external to the company who have purchased something from the company.
B. Only people internal to the company who directly use its product.
C. Anyone external to the company and those internal who rely on its product to get their job done.
D. Everybody external to the company who is currently doing, or may in the future do, business with the company.
Answer: C
Explanation:
One of the principles of total quality management (TQM) is customer orientation, whether the customer is internal or external. An internal customer is a member of the organization who relies on another member's work to accomplish his/her task.
14. Management of a company is attempting to build a reputation as a world-class manufacturer of quality products. Which of the following measures would not be used by the firm to measure quality?
A. The percentage of shipments returned by customers because of poor quality.
B. The number of parts shipped per day.
C. The number of defective parts per million.
D. The percentage of products passing quality tests the firsttime
Answer: B
Explanation:
The number of parts shipped per day would most likely be used as a measure of the effectiveness and efficiency of shipping procedures, not the quality of the product. This measure does not consider how many of the parts are defective.
15. Quality costing is similar in service and manufacturing organizations. Nevertheless, the differences
between these organizations have certain implications for quality management. Thus,
A. Direct labor costs are usually a higher percentage of total costs in manufacturing organizations.
B. External failure costs are relatively greater in service organizations.
C. Quality improvements resulting in more efficient use of labor time are more likely to be accepted by employees in service organizations.
D. Poor service is less likely to result in loss of customers than a faulty product.
Answer: B
Explanation:
External failure costs arise when problems occur after delivery. They occur because products or services are nonconforming or otherwise do not satisfy customers. External failure costs in service enterprises are even more important than in manufacturing environments. Faulty goods sometimes maybe reworked or replaced to a customer's satisfaction, but poor service tends to result in a loss of customers.
16. A means of limiting production delays caused by equipment breakdown and repair is to:
A. Schedule production based on capacity planning.
B. Plan maintenance activity based on an analysis of equipment repair work orders.
C. Pre-authorize equipment maintenance and overtime pay.
D. Establish a preventive maintenance program for all production equipment.
Answer: D
Explanation:
A preventive maintenance program reduces equipment breakdowns and repairs.
17. Under a total quality management (TQM) approach,
A. Measurement occurs throughout the process, and errors are caught and corrected at the source.
B. Quality control is performed by highly trained inspectors at the end of the production process.
C. Upper management assumes the primary responsibility for the quality of the products and services.
D. A large number of suppliers are used in order to obtain the lowest possible prices.
Answer: A
Explanation:
TQM emphasizes quality as a basic organizational function. TQM is the continuous pursuit of quality in every aspect of organizational activities. One of the basic principles of TQM is doing it right the first time. Thus, errors should be caught and corrected at the source.
18. Which of the following is a key to successful total quality management (TQM)?
A. Training quality inspectors.
B. Focusing intensely on the customer.
C. Creating appropriate hierarchies to increase efficiency.
D. Establishing a well-defined quality standard, then focusing on meeting it.
Answer: B
Explanation:
TQM emphasizes satisfaction of customers, both internal and external. TQM considers the supplier's relationship with the customer, identifies customer needs, and recognizes that everyone in a process is at some time a customer or supplier of someone else, either inside or outside of the organization. Thus, TQM begins with external customer requirements, identifies internal customer-supplier relationships and requirements, and establishes requirements for external suppliers.
19. The four categories of costs associated with product quality costs are:
A. External failure, internal failure, prevention, and carrying.
B. External failure, internal failure, prevention, and appraisal.
C. External failure, internal failure, training, and appraisal.
D. Warranty, product liability, training, and appraisal.
Answer: B
Explanation:
Prevention costs are incurred to prevent defects. Appraisal costs are incurred to detect defective output during and after the production process. Internal failure costs are associated with defective output discovered before shipping. External failure costs are associated with defective output discovered after it has reached the customer.
20. Statistical quality control often involves the use of control charts whose basic purpose is to:
A. Determine when accounting control procedures are not working.
B. Control labor costs in production operations.
C. Detect performance trends away from normal operations.
D. Monitor internal control applications of information technology.
Answer: C
Explanation:
Statistical control charts are graphic aids for monitoring the status of any process subject to random variations. The chart consists of three horizontal lines plotted on a horizontal time scale. The vertical scale represents the appropriate quantitative measure. The center line represents the average range or overall mean for the process being controlled. The other two lines are the upper control limit and the lower control limit. The processes are measured periodically, and the values are plotted on the chart. If the value falls within the control limits, no action is taken. If the value falls outside the limits, the process is considered "out of control," and an investigation is made for possible corrective action. Another advantage of the chart is that it makes trends visible.

QUESTION NO: 2
Which of the following is not required by ISO 9000 standards?
A. Establishment of a quality management system.
B. Creation of an internal audit system.
C. Consistent high quality products.
D. Onsite inspections by a registrar.
Answer: C
Explanation:
ISO 9000 is a set of generic standards for establishing and maintaining a quality system within an entity. The standards provide no basis forjudging the quality of the end product. The marketplace makes this determination. The objective of ISO 9000 standards is to ensure consistent quality.

QUESTION NO: 3
Which statement best describes total quality management (TQM)?
A. TQM emphasizes reducing the cost of inspection.
B. TQM emphasizes better statistical quality control techniques.
C. TQM emphasizes doing each job right the first time.
D. TQM emphasizes encouraging cross-functional teamwork.
Answer: C
Explanation:
TQM establishes quality as an organizational objective and views it as a major component of the organization's service to its customers. It emphasizes employee training and commitment, productservice design and production, and customer service. Ordinarily, the quality of a product or service is as important to customers as cost and timeliness. Superior product quality is not merely the result of more inspection, better statistical quality control, and cross-functional teamwork.
Manufactures must make fundamental changes in the way they produce products and do each job right the first time.

QUESTION NO: 4
Which of the following is a characteristic of total quality management (TQM)?
A. Management by objectives.
B. On-the-job training by other workers.
C. Quality by final inspection.
D. Education and self-improvement.
Answer: D
Explanation:
TQM is the continuous pursuit of quality in every aspect of organizational activities. One of the means of achieving this is through employee training and empowerment.

QUESTION NO: 5
The use of teams in total quality management (TQM) is important because:
A. Well-managed teams can be highly creative and are able to address complex problems better than individuals can.
B. Teams are quicker to make decisions, thereby helping to reduce cycle time.
C. Employee motivation is higher for team members than for individual contributors.
D. The use of teams eliminates the need for supervision, thereby allowing a company to become leaner and more profitable.
Answer: A
Explanation:
Teams can use the diverse knowledge and skills of all team members. Employee involvement means training and empowering employees to harness their creativity for problem solving. Quality control circles are used to obtain input from employees and to locate the best perspective on problem solving.

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Updated: May 27, 2022