Under JIT, the Number and Magnitude of Direct Fixed Costs

question 83

Multiple Choice

Under JIT, the number and magnitude of direct fixed costs

• A)decreases.
• B)increases.
• C)stays the same.
• D)are eliminated.

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Definitions:

Lowest Cost Solution

An approach or method that has the minimum possible cost among all the alternative approaches to achieve the same goal.

New Plant Addition

The establishment of an additional manufacturing or production facility to expand capacity or capabilities.

Total Construction Cost

The complete financial expenditure involved in constructing a building or infrastructure, encompassing material, labor, equipment, and indirect costs.

Operating Cost

Refers to the ongoing expenses associated with the running of a business, such as utilities, rent, payroll, and maintenance.