Which of the Following Is a Method of Reducing Cost

question 75

Multiple Choice

Which of the following is a method of reducing cost by identifying parts in different products that are common and interchangeable?

• A) Target costing.
• B) Value chain analysis.
• C) Concurrent engineering.
• D) Group technology.
• E) Theory of constraints.

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Definitions:

Special Order

A one-time customer order often involving a large quantity and possibly requiring adjustments to standard pricing or production processes.

Variable Manufacturing Cost

Costs that vary in direct proportion to changes in production volume, such as raw materials and direct labor.

Variable Selling Cost

Variable selling costs fluctuate with sales volume; they include expenses such as commission and shipping that increase with higher sales.

Constrained Resource

A limited resource within a system that significantly affects the throughput or output of the system.