_____ Occur When the Average Unit Cost of the Good

question 34

Multiple Choice

_____ occur when the average unit cost of the good or service begins to increase as the capacity and/or volume of throughput increases.

• A) Economies of scale
• B) Diseconomies of scale
• C) Costs of cushioning
• D) Capacity cushions

Know how inventory costs interplay with transportation decisions within supply chain management.

Understand the effects of transportation on the overall costs in supply chains.

Learn about the benefits and processes of temporal and physical aggregation in logistics.

Grasp the significance of tailored transportation choices based on customer and product characteristics.

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Definitions:

Work in Process

Inventory representing partially completed goods that are still in the production process.

Underapplied

A situation where the allocated manufacturing overhead cost is less than the actual overhead costs incurred.

Overapplied

A situation where the allocated manufacturing overhead cost exceeds the actual overhead incurred during a period.

Cost of Goods Manufactured

Total manufacturing costs incurred plus the beginning work-in-process inventory, minus the ending work-in-process inventory.