Comment critically on the following statements that you have overheard:
(a) ‘Direct labour hours are the most appropriate basis to use to charge indirect cost (overheads)
to jobs in the modern manufacturing environment where people are so important.’
(b) ‘Activity-based costing is a means of more accurately accounting for direct labour cost.’
(c) ‘Activity-based costing cannot really be applied to the service sector because the “ activities” that it seeks to analyse tend to be related to manufacturing.’
(d) ‘Kaizen costing is an approach where great efforts are made to reduce the costs of developing a new product and setting up its production processes.’
(e) ‘Benchmarking is an approach to job costing where each direct worker keeps a record of the time spent on each job on his or her workbench before it is passed on to the next direct worker or into finished inventories (stock) stores.’