The statement concerning lean accounting that is true is:
A) a perpetual inventory system needs to be implemented
B) the focus is on achieving economies of scale in production
C) labour is considered to be a period cost and is treated as more fixed than variable
D) all of the statements are true

Question

Quizplus · Accepted Answer

Lean accounting emphasizes on eliminating waste in order to improve efficiency and reduce costs. As a result, labor is treated as a period cost, which is relatively more fixed than variable, rather than being allocated as a direct cost to products, which can distort the cost of production. A perpetual inventory system may be used to track inventory in real-time, but it is not a mandatory requirement of lean accounting. The focus of lean accounting is not solely on achieving economies of scale, but rather on improving the entire value stream to create value for customers while eliminating waste. Therefore, options A and B are incorrect.

The Statement Concerning Lean Accounting That Is True Is