Describe the Four Generic Performance Dimensions of Operations and Supply

question 59

Essay

Describe the four generic performance dimensions of operations and supply chain activities.

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Definitions:

Overhead Efficiency

The effectiveness with which a company utilizes its overhead, often analyzed through the comparison of actual overhead costs with budgeted or standard costs.

Predetermined Overhead Rate

A rate derived from dividing estimated overhead costs by an estimated activity base, used to apply manufacturing overhead to products or job orders.

Variable Component

The part of a cost or expense that varies directly with the level of activity or production volume, such as direct materials or variable manufacturing overhead.

Fixed Component

A portion of costs within a business that remains constant, regardless of the level of production or business activity.