A Company Using Lean Production Methods Likely Would Show Approximately

question 177

Multiple Choice

A company using lean production methods likely would show approximately the same net operating income under both absorption and variable costing because:

• A)ending inventory would be valued in the same manner for both methods under lean production.
• B)production is geared to sales under lean production and thus there would be little or no ending inventory.
• C)under lean production fixed manufacturing overhead costs are charged to the period incurred rather than to the product produced.
• D)there is no distinction made under lean production between fixed and variable costs.

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