A theory which describes techniques of operating income maximization, facing with non-bottleneck and bottleneck operations is ___________?
Correct answer: B. theory of constraints
- A. theory of contribution
- B. theory of constraints
- C. theory of conflicts
- D. theory of maximization
Explanation
The Theory of Constraints focuses on maximizing operating income by identifying and managing bottlenecks while coordinating non-bottleneck operations. Its central idea is that the system's output is limited by its constraint.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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