Textbook: Purchasing and Supply Management by Johnson/Flynn

True / False

1. Operator action is required when process output exceeds the upper control limit (UCL) or dips below the lower control limit (LCL).

2. A Cpk of 1.00 is typically an acceptable ratio for industry.

3. The allocation between buyer and seller of the costs incurred when materials are rejected is affected by the kind of materials rejected, trade customs, the buyer’s cost accounting procedures, and the positions of strength of each organization.

4. Six Sigma is different than TQM because it primarily focuses on reducing only special cause variation.