Non-Value-Added Activities

question 102

Multiple Choice

Non-value-added activities

• A) should be minimized or eliminated.
• B) involve those activities that are essential to a company's operations.
• C) increase both the cost and perceived value of a product.
• D) cannot be differentiated from value-added activities.

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Definitions:

Manufacturing Overhead

All indirect costs associated with manufacturing a product, including indirect labor, materials, and other expenses not directly tied to producing the product.

Work in Process

Part of inventory that is in the process of being manufactured but is not yet a finished product.

Indirect Materials

Materials used in the production process that do not become an integral part of the final product and are not easily traceable to specific products.

Raw Materials

Basic substances or inputs in their natural, unprocessed, or minimally processed states used in manufacturing to produce finished goods.