Value Stream Costing Attempts to Do All of the Following

question 11

Multiple Choice

Value stream costing attempts to do all of the following except:

• A) Reduce the need for cost allocations.
• B) Increase tracing of direct costs to value streams.
• C) Identify and accumulate all value-stream costs.
• D) Eliminate the need for complex overhead allocation methods.

---

Definitions:

Indirect Method

A way of reporting net cash flow from operating activities in the statement of cash flows by adjusting net income for changes in working capital items and non-cash transactions.

Statement of Cash Flows

This financial statement provides an overview of a company's cash inflow and outflow over a period, detailing sources and uses of cash from operating, investing, and financing activities.

Operating Activities

Operating activities refer to the day-to-day functions involved in running a business, which are directly related to its primary activities and include generating revenue and paying expenses.

Depreciated Equipment

Equipment whose value has been reduced over time due to wear and tear or obsolescence, reflecting its reduced utility.