Which of the following statements related to the theory of constraints is/are TRUE?
A)Sales less direct materials costs equals throughput contribution.
B)Throughput contribution equals sales plus direct materials, and the theory of constraints focuses on revenue and cost management when an organization is faced with bottlenecks.
C)Throughput contribution equals sales plus direct materials.
D)The theory of constraints focuses on process-costing when an organization is faced with bottlenecks.
E)Throughput contribution equals sales plus direct manufacturing costs.

Question

Quizplus · Accepted Answer

Throughput contribution is calculated as sales minus direct material costs, which aligns with the theory of constraints' focus on maximizing throughput by managing bottlenecks.

Which of the Following Statements Related to the Theory of Constraints