Question

In: Accounting

The production subsystem of the conversion cycle includes all of the following EXCEPT: a. determining raw materials requirements. b. make or buy decisions ..

The production subsystem of the conversion cycle includes all of the following EXCEPT:

a. determining raw materials requirements.

b. make or buy decisions on component parts.

c. release of raw materials into production.

d. scheduling the goods to be produced.

 

Solutions

Expert Solution

The correct option is option (b).

b. make or buy decisions on component parts.

 

Explanation:

Make or buy decisions involve determining whether to produce certain component parts internally or to purchase them externally. This decision-making process is primarily strategic and managerial in nature, involving considerations such as cost, quality, and availability. While important for overall operations, make or buy decisions are not part of the direct operational activities within the production subsystem, which mainly focus on converting raw materials into finished goods efficiently.


The correct option is (b).

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