Table 13.5 -Use the Information in Table 13.5.Which of the Statements Concerning

question 82

Multiple Choice

Table 13.5

-Use the information in Table 13.5.Which of the statements concerning item RST is TRUE? (Examine each answer independently.)

• A) If the safety stock level were 30 units instead of 0 units, the planned receipt in week 7 would be 110 units.
• B) If the scheduled receipt in week 2 were delayed until week 3, there would be a planned order release in week 1.
• C) If the safety stock level was 20 units instead of 0 units, there would be a planned order release in week 2.
• D) If the gross requirements for week 8 were 100 units instead of 60 units, the projected on-hand inventory for week 8 would be 0 units.

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Definitions:

Absorption Costing

An accounting method that includes all of the manufacturing costs in the cost of a product, including direct materials, direct labor, and both variable and fixed overhead.

Profits

The financial gain made in a transaction or business operation after subtracting all expenses from revenue.

Units Produced

The total quantity of finished goods a manufacturing process produces in a specific period, reflecting production levels and efficiency.

Fixed Manufacturing Overhead

Costs that do not vary with the level of production output, such as rent, salaries of supervisory staff, and equipment depreciation.