Data for a Factory -
__________________ Involves Identifying the Increase in Value That Would

question 20

Multiple Choice

Data for a factory
$\begin{array}{ll}\text { Total factory cost } & £ 10,000 \\\text { Total time au ailable on key resource (hours) } & 2,500 \\\text { Contribution per unit product A } & £ 34.00 \\\text { Contribution per unit product B } & £ 30.00 \\\text { Contribution per unit product C } & £ 22.00 \\\text { Contribution per unit product D } & £ 20.00 \\\text { Hours required product A } & 12.0 \\\text { Hours required product B } & 6.0 \\\text { Hours required product C } & 6.0 \\\text { Hours required product D } & 8.0\end{array}$

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__________________ involves identifying the increase in value that would be created by having one additional unit of a limiting resource.

• A)Kaizen costing
• B)Supply chain management
• C)Feasible region
• D)Shadow prices

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Definitions:

Traditional Costing

An accounting method that allocates overhead costs to products based on a single, volume-based cost driver, such as direct labor hours.

Direct Labor-Hours

Represents the total hours worked directly on the production of goods.

Manufacturing Overhead

Costs related to the manufacturing process that cannot be directly linked to specific products, including utility costs, depreciation, and maintenance of equipment.

Predetermined Overhead Rate

An allocated rate used to apply manufacturing overhead to products or job orders, estimated at the start of an accounting period.