The kind of cost which on elimination, would not reduce the perceived usefulness that customers can obtain by using the market offering is known as ___________?
Correct answer: D. non-value added cost
- A. designed-in costs
- B. locked-in costs
- C. value added cost
- D. non-value added cost
Explanation
A non-value-added cost can be eliminated without reducing the usefulness or benefits customers receive from the product. Value-added costs, in contrast, contribute to features or functions customers value.
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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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