Which of the following statements is true of ABC systems? a. ABC systems provide less insight than
Question:
Which of the following statements is true of ABC systems?
a. ABC systems provide less insight than traditional systems intothe management of the indirect costs.
b. Service companies find great value from ABC because a vastmajority of their cost structure is composed of direct costs.
c. ABC systems is valuable for pricing decisions but not forunderstanding, managing, and reducing costs in governmentinstitutions.
d. ABC systems are used by managers for strategic decisions ratherthan for inventory valuation in merchandising companies.
Which of the following statements is true of just-in-time (JIT)purchasing?
a. Only disadvantage of JIT purchasing is the higher level carryingand inspection costs.
b. JIT purchasing is guided solely by the EOQ model becausethat model emphasizes the tradeoff between relevant carrying andordering costs.
c. In JIT purchasing, raw materials (or goods) are purchased sothat products are delivered just as needed for production orsales.
d. In JIT purchasing, the optimal safety-stock level is thequantity of safety stock that minimizes the sum of annual relevantstockout and carrying costs.
Auditing a risk based approach to conducting a quality audit
ISBN: 978-1133939153
9th edition
Authors: Karla Johnstone, Audrey Gramling, Larry Rittenberg