question archive 1) Why is there an unmistakable trend in manufacturing to improve quality? 2 Distinguish among spoilage, rework, and scrap
1) Why is there an unmistakable trend in manufacturing to improve quality? 2 Distinguish among spoilage, rework, and scrap
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1) Why is there an unmistakable trend in manufacturing to improve quality?
2 Distinguish among spoilage, rework, and scrap.
3 "Normal spoilage is planned spoilage." Discuss.
4 "Costs of abnormal spoilage are losses." Explain.
5 "What has been regarded as normal spoilage in the past is not necessarily acceptable as normal spoilage in the present or future." Explain.
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Answer:
1. Because managers have discovered that there is reduced costs and increase in sales due to quality improvement and intolerance for any high spoilage.
2. Spoilage is whereby units produced have not met the standards and quality required by customers and therefore the units are disposed at reduced prices compared to other units.
Rework is whereby units that do not meet the requirements of consumers are repaired or redesigned and sold at good prices as finished products.
Scrap is generally any residual either in form of material s or any resources that remains after manufacturing or production process of a product. It can also refer to the material that remains after the useful life of a product if the product was durable. It may have a value which is lower than that of the product in general.
3. Normal spoilage rate is determined by the management after considering the production process. This spoilage comes from the production process of a product and it also occur even when the operations or production process is efficient. Therefore, it is a planned cost as the management may decide the rate of normal spoilage.
4. Costs of abnormal spoilage are considered as losses because they arise from a production process but under efficient production process, such spoilage cannot occur. Therefore, they are measures of inefficiency hence should be written off as losses in the income statement.
5. The management of a business continuously try to reduce or affect the rate of normal spoilage. This effort in reducing the normal spoilage rate shows that the normal spoilage in the past may not be equal to the current or future normal spoilage.
