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Managerial Accounting: Overview Chapter One

Managerial Accounting: Overview Chapter One. FINANCIAL MANAGERIAL Outside Inside Follow GAAP/IFRS Timely and Relevant Standard Report Format Reports unstructured. TRADITIONALLY. “Idleness Waste Money” or if manpower and machine are not running you are losing money.

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Managerial Accounting: Overview Chapter One

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  1. Managerial Accounting: Overview Chapter One • FINANCIAL MANAGERIAL • Outside Inside • Follow GAAP/IFRS Timely and Relevant • Standard Report Format Reports unstructured

  2. TRADITIONALLY • “Idleness Waste Money” or • if manpower and machine are not running you are losing money

  3. Push through production---old • PUSH through Production –old way • Three inventories: Raw Materials (RM), Work in Process(WIP), Finished Goods (FG) • RM | WIP  FG • Company Queque Results in Large • Inventory waiting to be sold

  4. Lean Production • Lean means Less Costs • Advantages: • Lower Inventory required • Fewer Defects • Less Wasted Effort • Quicker Customer Response

  5. Lean production con’t • Summaries all theories into 1 • Value Added • Flow Chart of Activities • Manufacturing Cell • Just in Time (JIT) • Theory of Constraints

  6. Value Added • Activities that add value per customer • Chip Box vs Dove Box

  7. Flow Chart of Activities • Actions required to make product • Smores • Burn Place between Add SQUEEZE • MarshmellowGraham Cracker chocolate

  8. Add the 3 M’s (Manpower, Machines, Materials) • Smores • Burn Place between Add SQUEEZE • MarshmellowGraham Cracker chocolate • Cook CookCookCook • Burner/Fork Fork Clipper Press • Marshmellow 2 Graham Crk Choc Sq

  9. Traditional Production • Several large Machines with only one job each • Mixing Machine • Cutting Machine • Wrapping Machine

  10. Manufacturing Work Cell • One Machine performing several jobs • Several Multi-job Machines • Each Machine Mixes-Cuts-Wraps

  11. Just In Time (JIT) • Pull Through Production--- Customer initiates • RM  WIP   FG (Customer order) • Shipped immediately to customer • No queing of inventory

  12. Theory of Constraints • Control of Bottlenecks • Increase capacity to remove bottleneck where process has smallest capacity • Freeway system --- Norwalk on Interstate 5 • Throughput time--- Cycle time to manufacture a product

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