Utilization in Process-Oriented Facilities Is Frequently Low Because

question 64

Multiple Choice

Utilization in process-oriented facilities is frequently low because

• A) the postponement strategy for improving service productivity is being used
• B) scheduling in process-oriented facilities is not very complex
• C) with high fixed costs, utilization is not very important
• D) excess capacity for peak demands is desirable
• E) low raw material inventories cause machines to be idled

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Definitions:

Perpetual Inventory System

An accounting system that continuously updates inventory records and cost of goods sold after each purchase or sale.

Closing Entry

Journal entries made at the end of an accounting period to transfer the balances of temporary accounts to permanent ones, thereby preparing the books for the next period.

Selected Accounts

Accounts chosen for review or analysis, often for the purpose of financial reporting or auditing.

Normal Credit Balance

The expected positive balance of certain types of accounts in the double-entry bookkeeping system, such as liabilities, revenues, and equity accounts.