Which of the following approaches to cost-system design is likely most appropriate for a lean manufacturing context?
A) Activity-based costing (ABC).
B) Resource-consumption accounting (RCA).
C) Value-stream costing.
D) Direct costing.
E) Full absorption standard costing.

Question

Quizplus · Accepted Answer

In a lean manufacturing context, the focus is on identifying and eliminating waste to improve efficiency and reduce costs. Value-stream costing is the approach that best aligns with this goal as it identifies costs associated with specific value streams or processes, which allows for targeted efforts to reduce waste and increase efficiency. ABC, RCA, and full absorption standard costing may be too complicated and time-consuming for a lean manufacturing environment, while direct costing may not capture all relevant costs.

Which of the Following Approaches to Cost-System Design Is Likely