Fundamentals of Cost Accounting 3rd Edition by William N. Lanen, Shannon W. Anderson, Michael Maher

Exercise 10

What are examples of two nonvalue-added activities that could be found in each of the following service organizations: (a) a health clinic and (b) a bank?

Step 1 of 3

In addition to the value added activities, service organization also provides non-value added activities to its customers. Activities are comes under value added activities when it makes value addition to the organization. In contrast, non-value added activities are activities which provide direct benefits to the customers and not to the organization.