How does just-in-time manufacturing affect break-even analysis?
A) Variable costs are reduced with a corresponding increase in fixed costs.
B) Direct materials is the major variable cost.
C) Direct labour and maintenance are viewed as fixed costs.
D) all of the above

Question

Quizplus · Accepted Answer

Just-in-time manufacturing affects break-even analysis in all of the ways listed above. By reducing the need for inventory and storage, variable costs may be reduced, but fixed costs may increase due to the need for greater coordination and efficiency. Direct materials is typically a major variable cost in manufacturing, while direct labour and maintenance are often seen as fixed costs.

How Does Just-In-Time Manufacturing Affect Break-Even Analysis