Which of the following activities performed by a manufacturer of roller blades is not a value-added activity?
A) Inspection of direct materials upon receipt from suppliers.
B) Storage of direct materials until needed for production.
C) Transfer of direct materials to appropriate points on the assembly line.
D) Estimated lost sales due to poor quality.

Question

Quizplus · Accepted Answer

Estimated lost sales due to poor quality is not a value-added activity because it does not directly contribute to the production or improvement of the roller blades. It is a cost that results from not performing value-added activities effectively. The other activities listed, such as inspection, storage, and transfer of direct materials, are necessary steps in the production process and contribute directly to the quality and efficiency of the final product.

Which of the Following Activities Performed by a Manufacturer of Roller