What Is a Non-Value-Added Activity

question 3

Multiple Choice

What is a non-value-added activity?

• A) One that ultimately brings the process closer to completion or changes the product or service for the better
• B) Steps in a process that are necessary for regulatory or compliance reasons but do not bring the process closer to completion or do not change the product or service for the better
• C) An activity that enhances the process and moves it closer to completion or changes the product or service for the better
• D) None of these is correct.

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Definitions:

Straight-Line Rate

A method of calculating depreciation of an asset, which assumes the asset will lose an equal amount of value each year over its useful life.

Annual Straight-Line Depreciation

A method of calculating the depreciation of an asset, spreading its cost evenly over its useful life.

Straight-Line Depreciation Rate

A method of calculating the depreciation of an asset, where the asset's cost is evenly distributed over its useful life.

Useful Life

The estimated duration an asset is expected to be economically usable, with normal wear and tear.