Acct & Mis 631 (12-Production Cycle)

Front 1

Production Cycle

Back 1

business activities relating to the manufacturing a product

Front 2

Business Activities of Production Cycle

Back 2

1. Product Design
2. Planning/Scheduling
3. Product Operations
4. Cost Accounting

Front 3

Product Design (Bus Activity of Production Cycle)

Back 3

1. Meets customer requirements in terms of quality, functionality, and durability
2. Minimizes production costs

Front 4

Main Documents of Product Design

Back 4

1. Bill of Materials- indicates the part number, descriptions, and quantities of all component parts needed in making a product
2. Operations LIst- List the sequence of steps to produce a good, including equipment needed and time required for each step

Front 5

Role of Accountant in Product Design

Back 5

participates as between 60-80% of product costs are incurred in this activity

Front 6

Planning/Scheduling (Bus Activity of Production Cycle) Objective

Back 6

Develop a production plant that is efficient in that it will allow us to meet existing orders and projected in sales in the ST while minimizing RM and FG inventory

Front 7

2 Common Approaches to Production Planning

Back 7

1. Manufacturing Resource Planning (MRP II)- production plan developed on expected future sales

2. Lean Manufacturing- virtually eliminates all inventories bc goods are produced based on actual sales

Front 8

Important Documents of Planning/Scheduling (4)

Back 8

1. Master Production Schedule
2. Production Order
3. Materials Requisition Form
4. Move Ticket

Front 9

Operations List

Back 9

List the sequence of steps to produce a good, including equipment needed and time required for each step

Front 10

Bill of Materials

Back 10

indicates the part number, descriptions, and quantities of all component parts needed in making a product

Front 11

Master Production Schedule

Back 11

details how much of the product should be produced during the planning cycle

also used to determine if RM should be purchased, done by exploding master production schedule

Front 12

Production Order

Back 12

authorization to produce a specified quantity of products

Front 13

Materials Requisition Form

Back 13

authorization to transfer RM from warehouse to factory

Front 14

Move Ticket

Back 14

documents transfer of parts and materials on factory floor

Front 15

Product Operations (Bus Activity of Production Cycle)

Back 15

actual manufacturing of the product
operations for each company are unique

Front 16

Cost Accounting (Bus Activity of Production Cycle) Main Objectives (3)

Back 16

1. Provide accurate product cost information for use in pricing and product mix decisions
2. Capture and process the data to calculate COGS and ending inventory on the FS
3. To provide information useful in planning, controlling, and evaluating the performance of product operations

Front 17

2 Traditional Cost Accounting Systems

Back 17

1. Job Order Costing- used by companies who produce unique/discreet or separately identifiable products (landscaping)
Product costs are determined for each job
2. Process Costing- companies that make mostly identical products
product costs are accumulated per dpt.