Answer (D) is correct . Theory of constraints (TOC) has a short-term focus based on costs of materials and product mix; activity-based costing has a long-term focus which considers all product costs and is concerned with strategic pricing and profit planning.
Answer (A) is incorrect because Theory of constraints has a short-term focus.
Answer (B) is incorrect because Theory of constraints has a short-term focus.
Answer (C) is incorrect because Operation costing is a hybrid of job-order and process costing that is employed when a manufacturer’s products uses some similar processes and some custom processes. It cannot be classified as having a short- or long-term focus.
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