For Capacity Requirements Planning, Loads for Critical Work Centers Are

question 129

Multiple Choice

For capacity requirements planning, loads for critical work centers are calculated based on ___________.

• A) open external supplier orders and planned external supplier orders
• B) gross requirements for the end product
• C) open shop orders and planned shop orders
• D) safety stock
• E) the sum of ordering and carrying costs

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Definitions:

Unused Capacity

The available but not currently utilized production or service capacity of a company, which can signify lost revenue opportunities.

Time-based Activity-based Costing

An advanced form of activity-based costing that adds the dimension of time, improving the accuracy of allocating costs based on the actual activities that consume resources.

Overhead Costs

Indirect costs not directly traceable to a specific product or service, including utilities, rent, and managerial salaries.

Activity Rate

An activity rate is the cost driver rate used in activity-based costing to allocate overhead costs to products or services.