A limitation of the theory of constraints and throughput costing is that:
A) Management's attention is too focused on long-term results
B) Labour and overhead costs may be built up to excessive levels
C) Any product mix changes would not generate immediate cash flow effects
D) a and b are limitations

Question

Quizplus · Accepted Answer

Throughput costing focuses on short-term results and may lead to excessive labor and overhead costs as it emphasizes maximizing throughput without considering these costs.

A Limitation of the Theory of Constraints and Throughput Costing