1. How does a JIT system respond to the problems traditionally solved by carrying inventories?

   a.by purchasing extra materials when price discounts are offered

   b.by negotiating long-term contracts with supplier to lock in low prices

   c.by selecting an inventory level that minimizes the total of ordering and carrying costs

   d.by ensuring that sufficient inventory is on hand to prevent stockouts

2. Which of the following is NOT a manufacturing cost?

   a.overhead

   b.direct labour

   c.distribution costs

   d.direct materials

3. Which is the best description of the cost of production report?

   a.The production report summarizes the manufacturing activity that takes place in a process department for a given period of time.

   b.The production report provides information about the manufacturing costs incurred by the department.

   c.The production report provides information about the physical units processed by the department.

   d.The production report includes the costs related to a specific job.