Setup Time for a Product Is 12 Hours

question 108

Multiple Choice

Setup time for a product is 12 hours. A firm that uses JIT and produces the same product has reduced setup time to 1 hour. Setup labor is $6 per hour. The non-value-added costs are

• A)$72.
• B)$66.
• C)$12.
• D)$6.

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Definitions:

Line Positions

Positions or roles within an organization that have direct responsibility for achieving the company's primary objective.

Managerial Accounting Report

A type of financial report that provides internal management with business operation insights for decision-making.

Dollar Savings

The amount of money saved as a result of spending less, typically measured in dollar terms.

Production Process

The sequence of operations that are involved in the transformation of raw materials into finished goods or services.