Kaizen Costing Relies On

question 21

Multiple Choice

Kaizen costing relies on:

• A) Sales forecasts of prices and volumes
• B) Commodity markets
• C) Zero-based budgeting processes
• D) Classification based on cost behaviour

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Definitions:

Working Capital

The difference between a company's current assets and current liabilities, indicating the short-term financial health and operational efficiency of a business.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term and long-term obligations, calculated as current assets divided by current liabilities.

Acid-test Ratio

A financial metric that measures a company's ability to pay off its current liabilities with its most liquid assets without relying on the sale of inventory.

Debt-to-Equity Ratio

A ratio used to measure the balance between the amount of debt and equity financing a company's assets.