Under Kaizen Costing, Accountants Forecast

question 56

Multiple Choice

Under kaizen costing, accountants forecast

• A) Declining prices and establish cost reduction goals to maintain a desired profit margin
• B) Cost reduction goals and desired profit margins, then adjust prices accordingly
• C) Declining profit margins and establish revenue and cost goals to meet them
• D) Increasing profit margins and establish revenue and cost goals to meet them

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Definitions:

Shareholders

Individuals or entities that own one or more shares of stock in a public or private corporation, giving them partial ownership of the company.

Dividends

Payments made by a corporation to its shareholder members, usually in the form of cash or stock, representing a share of the corporate profits.

Retained Earnings Account

An equity account on the balance sheet that represents the accumulated net income of a company that has not been distributed to shareholders as dividends.

Net Income

The amount of profit remaining after all expenses, taxes, and costs have been subtracted from total revenue.