In a Lean Environment, Anything Not Essential to the Product

question 42

True/False

In a lean environment, anything not essential to the product or process is viewed as waste.

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Definitions:

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life.

Manufacturing Overhead-Applied

The allocation of manufacturing overhead costs to individual products or job orders based on a pre-determined overhead rate.

Direct Labor

The wages and other costs for labor directly involved in the production of goods or services.

Annual Overhead

The total recurring business expenses not directly tied to the production of goods or services, calculated on a yearly basis.