Managers find operation costing useful in cost management because it ________.
A) often results in profit maximization
B) results in cost minimization
C) focuses on control of physical processes of a given production system
D) uses job costing to account for the conversion costs and process costing for the material and customizable components

Question

Quizplus · Accepted Answer

Operation costing focuses on control of physical processes of a given production system, enabling managers to identify cost drivers and improve efficiency in production processes. It helps in identifying areas where costs can be reduced and helps in cost management by optimizing the use of resources. Option A and B are not always true as profit maximization and cost minimization may not always be the ultimate goal. Option D is incorrect as job costing and process costing are two different costing methods and are not used in conjunction in operation costing.

Managers Find Operation Costing Useful in Cost Management Because It