Controlling material flow , Managerial Accounting

Assignment Help:

Controlling material flow

Figure below outlines the progressive stages in purchasing, issuing and recording materials in a manufacturing concern. An efficient system of documenting and recording is vitally necessary, not only for accounting purposes, but to ensure that the right materials arrive at the right place at the right time.

The purchase requisition submitted to the buyer may be triggered automatically if the system is computerized, by a message from the stores ledger that the reorder level has been reached. Other requests to purchase may be raised by the production planning department for new product materials not yet carried in stock, and also by any departmental head for supplies and equipment of any kind.

The buyer, ideally after making enquiries of several suppliers, sends a purchase order, and eventually the material is received, checked by the good-inwards department as to quality and quantity, and is detailed on a goods-received note (GRN). One copy of the GRN goes to the buyer to write off the outstanding order record; one to the accounts department for checking against the order and invoice—the latter authorizing payment to the supplier; and one to the stores department with the materials.

 

86_flow digarm.jpg


Related Discussions:- Controlling material flow

Explain about office and administrative expenses, Explain about Office and ...

Explain about Office and administrative expenses These expenses are not related to factory but they pertain to the management and administration of the business. Such expenses

Transfer pricing , Western States Supply, Inc. (WSS), consists of three div...

Western States Supply, Inc. (WSS), consists of three divisions—California, Northwest, and Southwest—that operate as if they were independent companies. Each division has its own sa

Kinematic pair-kinematic element-resistant body , Kinematic Pair: A pair ...

Kinematic Pair: A pair is a joint of two elements which permits relative motion. The relative motion among the elements of links that built a pair is needed to be fully constrain

Time series analysis, how do i use least squares method to solve semi avera...

how do i use least squares method to solve semi average problem?

Exercises and Problems, Exercises 2-1, 2-2, 2-3, 2-4 Problem 2-14 I didn’t...

Exercises 2-1, 2-2, 2-3, 2-4 Problem 2-14 I didn’t write every question down out of the book just questions 2-1, and 2-2. Exercise 2-1 classifying manufacturing cost. Your boat,

Explain the product life cycle costing, Product life cycle costing It i...

Product life cycle costing It is an approach used to give a long term picture of product line profitability feedback on the effectiveness of life cycle planning and cost data t

Extra cost decision, Discuss arguably how management accountants should dec...

Discuss arguably how management accountants should decide when are faced with the extra shift decision

What are the advantages of incremental budgeting, Advantages of incremental...

Advantages of incremental budgeting a) The budget is stable and change is gradual b) Managers can operate their departments on a steady basis c) The system is relatively

Accounting information system, I have 20pages preparing a system flowchart ...

I have 20pages preparing a system flowchart assignment

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd