A value-added cost is the cost of an activity that a company cannot eliminate without affecting a product's value to the customer.

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A value-added cost is defined as a cost that adds value to a product or service and cannot be eliminated without affecting its quality or perceived value to the customer. Examples of value-added costs include research and development, quality control, and customer service. Non-value-added costs, on the other hand, are costs that do not add value to a product or service from the customer's perspective and can be eliminated without affecting its quality or performance.

A Value-Added Cost Is the Cost of an Activity That