Under Kaizen costing, accountants forecast:
A) Declining prices and establish cost reduction goals to maintain a desired profit margin
B) Cost reduction goals and desired profit margins, then adjust prices accordingly
C) Declining profit margins and establish revenue and cost goals to meet them
D) Increasing profit margins and establish revenue and cost goals to meet them

Question

Quizplus · Accepted Answer

Under Kaizen costing, accountants forecast declining prices and establish cost reduction goals to maintain a desired profit margin. This approach focuses on continuous improvement in the production process to reduce costs and increase efficiency, which in turn allows for stable profit margins despite declining prices. Therefore, the correct option is A.

Under Kaizen Costing, Accountants Forecast