The Sales and Operations Planning Strategy to Be Used Should

question 110

Multiple Choice

The sales and operations planning strategy to be used should be consistent with the business environment. Which one of the following pairs of business environment and strategy is consistent?

• A) skilled labor in short supply; adjust workforce levels
• B) low inventory holding cost; build anticipation inventory
• C) ample labor supply; increase backlog for short-term demand surges
• D) seasonal requirements and ample, unskilled labor supply; subcontracting

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Definitions:

Job Order Costing System

An accounting method that tracks manufacturing costs individually for each job, suitable for customized orders or projects.

Actual Overhead Costs

The real costs incurred from overhead activities, as opposed to budgeted or estimated overhead costs, including utilities, rent, and insurance.

Finished Goods

Items that are fully manufactured and available for sale to consumers.

Predetermined Overhead Rate

A projected cost per activity unit utilized for distributing manufacturing overhead expenses across products.