Cost Management: A Strategic Emphasis 5th Edition by David Stout, Edward Blocher, Gary Cokins

Exercise 17

Why do firms using JIT systems often have little interest in materials price variances?

Step 1 of 2

New systems are made available to make the manufacturing process more effective with the advancement of technology and necessity to minimize waste. Organizations try had to increase the productivity by adopting new methodologies in production and ^house- keeping. Any of the process that demands more than the cost budgeted in the master budget will prove inefficient to the firm.