The correct answer is C. lean accounting.
Lean accounting is a method of costing that supports the creation of value for the customer by accounting for the entire value stream, rather than individual departments or products. It does this by focusing on the activities that add value to the product or service, and by eliminating waste.
Lean accounting is based on the principles of lean manufacturing, which is a production method that focuses on eliminating waste and improving efficiency. Lean accounting uses the same principles to improve the efficiency of accounting processes.
One of the key features of lean accounting is the use of value stream maps. A value stream map is a visual representation of the steps involved in creating a product or service. It shows the flow of materials and information, and the time and cost associated with each step.
Value stream maps can be used to identify waste in the production process. Waste can be anything that does not add value to the product or service, such as waiting time, transportation, or overproduction.
Once waste has been identified, it can be eliminated or reduced. This can be done by changing the way the product is produced, or by changing the way the process is managed.
Lean accounting can also be used to improve the accuracy of costing. Traditional costing methods often use averages to allocate costs to products or services. This can lead to inaccurate costing, as it does not take into account the variation in costs from one product or service to another.
Lean accounting uses a more accurate method of costing, called activity-based costing. Activity-based costing allocates costs to products or services based on the activities that are required to produce them. This results in more accurate costing, which can be used to make better decisions about pricing and profitability.
Lean accounting is a powerful tool that can be used to improve the efficiency of accounting processes and the accuracy of costing. It is based on the principles of lean manufacturing, which focuses on eliminating waste and improving efficiency. Lean accounting can be used to improve the value that is created for customers, and to reduce costs.
Economic accounting is a method of accounting that focuses on the economic impact of an organization’s activities. It is used to measure the value of an organization’s assets, liabilities, and equity. Economic accounting is not used to measure the cost of goods sold or the value of inventory.
Back-flush accounting is a method of accounting that is used to track costs in a just-in-time manufacturing environment. It is based on the assumption that all costs are incurred at the time of production. Back-flush accounting is not used to track costs in a traditional manufacturing environment.
Lead accounting is a method of accounting that is used to track costs in a customer-focused environment. It is based on the assumption that all costs are incurred at the time of a sale. Lead accounting is not used to track costs in a traditional manufacturing environment.