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.

---

Definitions:

Modernization Theory

A theory suggesting that traditional societies will develop economically and socially to adopt the characteristics of industrialized societies through processes like technological innovation.

Underdeveloped Countries

describes countries with low levels of industrialization, inadequate infrastructural facilities, and a generally low standard of living.

Internal Characteristics

Traits or features that originate within an individual or entity, defining their innate qualities or attributes.

Dependency Theorists

Scholars who argue that economic disparities between nations arise from the exploitation of poorer countries by wealthier ones, leading to a state of dependency.