MRP Systems Ensure That Materials and Components Are Available ______

question 97

Multiple Choice

MRP systems ensure that materials and components are available ______.

• A)based on demand forecasts
• B)when actual orders are received
• C)based on seasonality
• D)based on product price

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Definitions:

Variable Costing

An accounting method that includes only variable production costs (direct materials, direct labor, and variable manufacturing overhead) in product cost calculations, excluding fixed overhead.

Unit Product Cost

The total cost (both fixed and variable) to produce a unit of product, often used in pricing and decision-making processes.

Absorption Costing

A product costing approach within accounting that captures the entirety of manufacturing costs—direct materials, direct labor, and overheads, whether they are variable or fixed.

Variable Costing

A costing approach that solely incorporates variable manufacturing expenses such as direct materials, direct labor, and variable manufacturing overhead into the costs per unit of product.