Which of the following statements related to the theory of constraints is/are true?
A) Sales less direct materials costs equals throughput contribution.
B) Throughput contribution equals sales plus direct materials, and the theory of constraints focuses on revenue and cost management when an organization is faced with bottlenecks.
C) Throughput contribution equals sales plus direct materials.
D) The theory of constraints focuses on process-costing when an organization is faced with bottlenecks.
E) Throughput contribution equals sales plus direct manufacturing costs.

Question

Quizplus · Accepted Answer

Throughput contribution in the theory of constraints is calculated as sales minus direct materials costs. The theory focuses on maximizing throughput while managing constraints or bottlenecks in the production process.

Which of the Following Statements Related to the Theory of Constraints