Cost Accounting and Supply Chain Management

An excess materials requisition is a control that signals that a standard quantity of materials is being ordered from the vendor.

Cost accounting initiates a WIP account upon receiving the last move ticket of a batch.

A company's value stream map depicts only the non-value added activities needed to complete a process or product.

Manufacturing firms that achieve world-class status do so by following a philosophy of mass production.

The purpose of the cost accounting system is to direct the movement of work-in-process.

An example of a batch process is the production of gasoline.

ERP evolved directly from MRP.

The production schedule is a description of the type and quantity of raw materials and subassemblies used to produce a single unit of finished product.

Batch processing is used to produce items such as milk products and jet aircraft.

A move ticket is the formal plan and authority to begin production.

In batch processing, each item in the batch is custom-made to meet individual customer specifications.

Setting up and retooling is not required for different batches in batch processing.

In a functional organization, workers are divided into departments based on their job functions.

Immediate feedback about deviations from the norm is a deficiency of traditional cost accounting information systems.

Cost objects describe the work performed in a firm.

Activity-Based Costing (ABC) is widely used because it is simple and easy to implement.

Traditional firms provide detailed information about activities in their information reporting.

Labor costs of employees who design the product are considered value stream costs.

All assumptions of the EOQ inventory model are always correct.

Segregation of functions control procedure is violated when production planning and control is located apart from the work centers.

Retention of excess materials by work centers is an internal control procedure that should be in place in the conversion cycle.

Process simplification involves organizing the process into functional departments.

A manufacturing process that is organized into group technology cells utilizing no human labor is called a completely automated manufacturing process.

Value stream costs include only labor costs and costs of rent and building maintenance.

Inventories can be used to hide production problems in a manufacturing process.

The lean manufacturing philosophy emphasizes the importance of maintaining high levels of inventory.

Automation is a key aspect of traditional manufacturing.

Computer numerical controlled (CNC) machines are typically used in traditional manufacturing.

Inventories can lose value over time due to obsolescence.

The willingness to maintain inventories can lead to underproduction.