...lack of professional techniques that take place not only in the company studied, which affect the efficiency of the business. THE REAL STRATEGIES IN SHOE MANUFACTURING Nowadays there are many different approaches and methodologies that can be used for industrial systems’ optimization and analysis. Among these techniques are the ones for production and inventory management and industrial plant distribution, which are mainly used for reducing the company’s cost. According to APICS Dictionary, production management consists of “planning, scheduling, executing and controlling the process of converting inputs into finished goods.” In addition APICS Dictionary defines inventory as “those stocks or items used to support production (raw materials and work-in-process items), supporting activities (maintenance, repair, and operating supplies), and customer service (finished goods and spare parts).” (2) For many businesses it is very important to maintain certain number of goods in inventory because their capacity it is not enough to fulfill clients’ orders. Each product in inventory represents money, an investment tied up until finished products are delivered to clients. It is important to select the best techniques depending on the type of industry and the goals of the company. ZEBRA SHOES The company Zebra Shoes is located in the metropolitan area of Mexico City, Mexico, and they produce and sell sneakers. Those shoes are manufacture in seven different colors and eight ...
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...Sample Exam Question Answer Q3 The classification of industrial products can be classified into materials and parts, capital items and supplies and services. Materials and parts are industrial goods that become part of the buyer’s product. It consist of raw material such as farm products and natural products and manufactured materials and parts such as component material that need to be processed further and component part that is a finished product with no further change in form. Capital items are industrial goods that contribute to the production of the finished product. It includes installations such as buildings and fixed equipment’s which are the major purchases of the business and accessory equipment, which aid in the production process such as portable factory equipment and office equipment. The last classification of industrial products is the supplies and services. Supplies are made up of operating supplies which is the convenience product in the industrial market and services is made up of business advisory services and maintenance and repair people. Q6 One of the four characteristics that distinguish services from physical goods in the context of products is the intangibility aspect of service. It cannot be tasted, heard, felt, seen before the purchase of the product. For example, the result of cosmetic surgery can only be seen after the surgery is done. Next, service has the characteristic of inseparability. The service cannot be separated...
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... Materials Conversion Units completed and transferred out (all units are 100% complete with respect to materials) 190,000 190,000 Work in Process, March 31: Materials: 60,000 X 100% 60,000 Conversion: 60,000 X 30% 18,000 -------------- --------------- Equivalent Units of Production 250,000 208,000 Materials Conversion Costs in beginning work in process $ 200,000 $ 291,200 Costs added during the year 600,000 582,400 Total $800,000 873,600 Equivalent Units of Production 250,000 208,000 Cost per Equivalent Unit $3.20 $ 4.20 b. Costs transferred to finished goods 190,000 X ( $3.20 + $4.20) = $ 1,406,000 c. Ending Work in Process: Materials 60,000 X $ 3.20 = $ 192,000 Conversion: 18,000 X 4.20 = $ ...
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...To Hedge or Not To Hedge - Raw material price management and added value from treasury by Wolfgang Frontzek, Director of Group Treasury/Corporate Finance, Wilo I For years, treasurers have been tackling the problems of interest and exchange rates in an analytical and structured manner. n recent years, commodities buyers have had to cope with extreme price increases and price fluctuations. Where it was not possible to cushion or pass on the effects of the price rises, they often had a negative impact on company profits. Rising raw material prices are not the only problem that buyers have, as the buyer is responsible not only for a fixed calculation or price basis but also for ensuring continuity of the production process, certainly over the medium term and thus over a planning period of 12-24 months. Price volatility presents the same problem, as it makes commodity prices genuinely unpredictable. An active financial risk management process is necessary, to answer the following questions: How high is the exposure? What percentage of the production costs do raw material costs account for? What effect does the price fluctuation of raw materials have on total profits? Can price fluctuations be passed on? What is the competition doing? Based on this peak, the company is exposed to a price movement risk of USD 1.700 per tonne or a total of USD 5.1m. Accordingly, the price opportunity on the basis of the record low in 1997 of USD 1.000 is relatively small at USD 150 around...
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...the beginning of the year ; Finished goods 7000 :Work in progress 4000 Purchase of material 110000 Material – At the beginning of the year 3000 * At the end of the year 4000 Direct labour 65000 Factory overhead 60% of the direct labour cost Inventory at the end of the year: Work in progress 6000 : Finished goods 8000 Other expenses: Selling expenses 10 % of sales and administrative expenses 5% of sales . Answer – 224000 2. Prepare a cost sheet and cost per unit Raw materials consumed Rs. 200000 Direct wages Rs.80000 Factory overheads Rs. 20000 Direct expenses Rs.50000 Office overheads 10% of factory cost Selling overheads Rs. 5 per unit Units produced 4000 units Units sold 3600 units Selling price Rs. 120 per unit 3. X has furnished the following information relation to the production of 1000 discs manufactured by it during the year 2002 Cost of materials 100000 Direct wages paid 70000 Cost of power and consumables stores (20% fixed) 15000 Factory indirect wages paid (40% fixed) 20000 Cost of lighting in the factory (fixed)10000 Office expenses paid (70% variable) 30000 Selling expenses paid (70% variable) 50000 Depreciation of plant 10000 Entire output was sold at Rs.350 per unit For the year 2003, it is estimated that the production will be increased by 50% by utilizing the spare capacity and the rates for materials and direct wages will increase by 10%, 20% respectively. The expenses of the...
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...|Sales Budget |April |May |June |Quarter |July |August | |Sales price | | | | | | | |Total Sales | | | | | | | | | | | | | | | |Cash collection |April |May |June |Quarter |July |August | |April sales | | | | | | | | | | | | | | | | | | | | | | | |May sales | | | | | | | | | | | | ...
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... Stevie Perry University of Phoenix Web 237 The first section of my website purpose contains the communication of my site purpose, my target audience and my content needs. My website will be called Storybook.com. This website will have the accessibility to download books for purchase or view online for a lesser fee. The purpose of this website is for children and teenagers alike to utilize the website for educational purposes as well as obtain different reading materials for their personal use. My target audience would be different ages of children as well as parents who may want to use the educational part of this website to help educate their children who enjoy the computer. They can use this website for the educational needs as well as needs for other books children may like. The website will contain books for reading, handwriting, math, and foreign languages. In addition, it will have the links to enter fictional as well as non-fictional reading material. The teenager will have the luxury of viewing teen reading materials. As far as the educational materials, it will allow access to all the basic materials that are used today in the school system. All subjects from English, math, and foreign languages as well as study guides for all classes and the SAT and ACT. The contents that are needed at the present time would be programs such as Adobe Flash and HMTL to create an interesting interactive navigation site. This site...
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...PROC5000/Anthony Vatterott/SPARTAN HEAT EXCHANGERS, INC/Dalton 1 SPARTAN HEAT EXCHANGERS, INC. Rick Coyne is the Materials Manager at Spartan, Inc. Until recently, the company has benefitted from excellence in customization and specialized research & development of design with full-service custom unit fabrication. This has historically allowed Spartan to maintain a positive rapport with clients, as their approach allowed for meeting the client’s specific needs. However, the industry trend has changed and competition from international sources has pressured Spartan’s Executive Management to revise the fiveyear development plan to compete with Korean and European firms. The standard for the industry has shifted from customized solutions to a low-price, highly-standardized market. This is not in line with Spartan’s current initiatives and Max Brisco, vice president of manufacturing, has solicited Rick to provide a detailed plan on how to achieve savings and efficiency in a transition to a more competitive manufacturing structure. The most critical step in this reformation is to redesign workflow and job order processing from a job order/job ticket method to a more streamlined and standardized process. This will require re-engineering the workflow of the manufacturing workforce, and offers an opportunity for the research & design component to redirect their efforts away from customized products and toward a working internal manufacturing process. The use...
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...Chap -1 Production management DEFINITION As any premises in which person are employed for the purpose of making altering , repairing ornamenting , finishing , clearing , washing , breaking , adopting for sale any article PRODUCTION AS THE CONVERSION PROCESS Production process of changing input into output . INPUT Lab our Material Equipment Capital Management OUTPUT Goods and services Conversion Process COMPARISION Actual V/s Planned The input to the production system are raw material , parts , energy , production schedules , information technology , capital or management and output are the goods , transported goods ,delivered message , services customers. For example :- 1) In manufacturing organization like steel plant , input are materials like iron , ore , coke , lime stone ,etc 2) In service organization like bank , inputs are customer and output are serviced customer COMPONENTS OF PRODUCTION FUNCTION PLANNING | * Product selection and design * Process selection and planning * Facility location * Facility layout and materials handling * Capital planning * Forecasting * Production planning | ORGANISING | * Work study and job design | CONTROLLONG | * Production control * Inventory control * Quality control * Maintenance and replacement * Cost of reduction and cost control | 1. Production selection and design -A right kinds of products and good design of the product are crucial for the...
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...Module-Summer 2012 ECCO Vertical Integration Cow to Shoe • • • • Ecco value chain is actually rawhide to shoe Purchases raw hides and transforms into leather used in shoe production Owns tanneries in Netherlands, Indonesia and Thailand Processes 3,500 raw hides a day equalling 1 million cows per year ECCO Value Chain What is the future of ECCO's leather manufacturing? Full Scale Bench marking Prototype Ramp-up Laboratory Production Product Development (R&D) Design Leather Manufacturing Shoe Production Distributing Raw hides Tannery Operations Post Tannery Operations Finishing Operations Discontinue-"blow it up" Sell it ECCO Value Chain What is the future of ECCO's leather manufacturing? Full Scale Bench marking Prototype Ramp-up Laboratory Production Raw Material Procurement Product Development (R&D) Design Shoe Production Distributing But let's stop to reconsider......... ECCO Value Chain What is the future of ECCO's leather manufacturing? Full Scale Bench marking Prototype Ramp-up Laboratory Production Raw Material Procurement Product Development (R&D) Design Shoe Production Distributing Leather manufacturing Value Add Global top five leather producer Leather centre developing leading technology Supplies automotive and furniture industry Quality Materials Resources Leather Manufacturing Strategy Quality Products VRIO Analysis Leather Manufacturing ...
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...PWC Case The Consumer Vitamins (CV) division of ABC Pharmacy Co is outsourcing their vitamin C supplements to Moberly Manufacturing Co. while getting the raw materials from SS Sugar Inc. The process of manufacturing starts by CV placing an order in SS. After SS received the order, the raw materials will be shipped to Moberly. In order to produce the semi-finished good, Moberly needs to get the stock materials from CV division. Then, the semi-finished goods will be shipped to CV division to be further processing and packaging. | Risks | Controls | 1 | Ordering unnecessary material | 1. Review purchase requisitions 2. Integrate related information in ERP system | 2 | CV places wrong purchase order | 1. Two-way match2. Double check the order before placing the order | 3 | The timing of the shipment from SS | 1. CV should sent its employee to SS make sure the shipping is in time | 4 | Inferior materials from SS | 1. Moberly should check the product amount and quality from SS | 5 | Moberly manufacturing problem | 1. Minimize possible misunderstandings when communicating the manufacturing specifications2. List clearly all requirements and restrictions in contract. | 6 | Stealing of inventory | 1. Moberly checks materials from SS before and after manufacturing2. Segregation of duty3. Keep the storage locked4. Ethical training | 7 | Problem of CV’s payment to SS and Moberly | 1. Segregation of duties 2. Three-way match3. Only pay invoices off of original copies | ...
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...period that have high risk of shoplifter. i.e. weekend 2. The number of people that had use the library and the time they stay there. Having this information can help the council to decide whether or not the library is not being used or overcrowded. 3. The number of people who rent a car should be record as well as the number of people who request to rent a luxury car. 4. The number of times that the machine broke down is needed. 2.13) Controllable cost: cost of food used in the casino restaurant, cost of dealer’s salary, maintenance cost Uncontrollable cost: cost of advertising campaign for the Casino, cost of accounting, cost of customer winning a jackpot 2.23) Product cost: cost assign to goods that were either manufactured or purchase for resale Period cost: cost that are expenses in the accounting period in which they are incurred Variable cost Fixed cost Manufactured cost 1. Product cost 2. Period cost 3. Period cost 4. Fixed cost 5. Fixed cost...
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...INTRODUCTION Organization is viewed as a group of persons for achieving its goals. The study about organization is termed as organization study. Organization affects the quality of human life in modern society. The study of organization is thus very essential for understanding the behaviour of human being. Organization can be studied in two perspectives that are micro and macro. In micro perspective, the focus of study is on individuals. It concerns itself with each individual’s psychological makeup, his interaction with other individuals and groups. The micro view of individuals in organization is recognized as a discipline called organizational behaviour. The macro view considers organization as the unit of analysis in place of an individual. It is concerned with organization as the unit of analysis in place of an individual. It is concerned with organizational goals, organizational structure, technologies used in organization and how organization interact with the environment. The macro perspective is recognized as a discipline called organizational theory. Both these aspects are taken together to present a complete picture of organizational study. The organization study is a relevant part of our MBA program; this would enable to meet and attain a practical and real time feed of various aspects concern and to relate it to be concept and theory studies...
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...distributions at each tool have changed. The LT factory began production by investing most of its cash into capacity and inventory. Specifically, on day 0, the factory began operations with three stuffers, two testers, and one tuner, and a raw materials inventory of 9600 kits. This left the factory with zero cash on hand. Customer demand continues to be random, but the long-run average demand will not change over the product’ 486-day lifetime. At s the end of this lifetime, demand will end abruptly and factory operations will be terminated. At this point, all capacity and remaining inventory will be useless, and thus have no value. Management is currently quoting 7-day lead times, but management would like to charge the higher prices that customers would pay for dramatically shorter lead times. In addition, because the factory is essentially bootstrapping itself financially, management is worried about the possibility of bankruptcy. To minimize this threat, management policy dictates that new equipment cannot be purchased if the remaining cash balance would be insufficient to purchase at least one order quantity’ worth of raw materials. s Operations Policies at Littlefield LT uses a Reorder Point / Order Quantity raw material purchase policy. That is, raw kits are purchased as soon as the following three criteria are all met: (1) the inventory of raw kits is less than the reorder point, (2) there are no orders for raw kits currently outstanding, and (3) the factory...
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...Cristiana-Luminiţa Assistant, Ph.D. Student Spiru Haret University, Faculty of Financial Accounting Management Craiova and University of Craiova, Faculty of Economics and Business Administration, Craiova e-mail: cristiana.bogdanoiu@yahoo.com Abstract This paper aims to discuss issues related to the improvement of management accounting in the dairy industry by implementing standard cost method. The methods used today do not provide informational satisfaction to managers in order to conduct effectively production activities, which is why we attempted the standard cost method, it responding to the managers needs to obtain the efficiency of production, and all economic entities. The method allows an operative control of how they consume manpower and material resources by pursuing distinct, permanent and complete deviations during the activity and not at the end of the reporting period. Successful implementation of the standard method depends on the accuracy by which standards are developed and promotes consistently anticipated calculation of production costs as well as determination, tracking and controlling deviations from them, leads to increased practical value of accounting information and business improvement. Key words: standard cost method, calculation, deviations, effective costs, standard costs. JEL Classification: M40, M41 Introduction The main objective of the development and diversification of the costing methods in the dairy industry is to make them more operational and effective...
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