Consider the following actions of a manufacturing firm trying to manage the costs of material handling from the direct materials inventory to the production line. Required: Match each of the process improvements listed with how it delivers cost reductions. Process Improvement Delivers Cost Reduction 1. The material inventory is placed closer to the production line. 2. Production runs have been made longer (more units produced in each run). 3. More direct material is being purchased resulting in larger direct material inventory. Improving the efficiency of the activity. Neither reducing the frequency of the activity nor improving the efficiency of the activity. Reducing the frequency of the activity.

Consider the following actions of a manufacturing firm trying to manage the costs of material handling from the direct materials inventory to the production line. Required: Match each of the process improvements listed with how it delivers cost reductions. Process Improvement Delivers Cost Reduction 1. The material inventory is placed closer to the production line. 2. Production runs have been made longer (more units produced in each run). 3. More direct material is being purchased resulting in larger direct material inventory. Improving the efficiency of the activity. Neither reducing the frequency of the activity nor improving the efficiency of the activity. Reducing the frequency of the activity.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter1: Introduction To Managerial Accounting

Section: Chapter Questions

Problem 6E

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