A pool rate is the pooled cost per unit of activity. Once a pool rate has been determined, costs are assigned to products by adding the number of unit activities to the pool rate. Under traditional product costing systems, high-volume products are overcosted. In an activity-based costing system, statistical correlation can show how accurately costs have been assigned. Storage is a value-added activity.
Idle time is non-value added.
In a push manufacturing system, goods are produced only when demand arises. A manufacturing Kanban is a card that indicates the type and amount of materials that a work center needs. A JIT manufacturer is likely to have many suppliers. Small lot sizes of material and parts is a characteristic of JIT manufacturing. JIT manufacturers devote a lot of resources to inspection to insure quality.