Cost Accounting and Advanced Technology

The introduction of high-tech into the manufacturing. process has, in most instances, been accompanied by a significant shift in emphasis in manufacturing management. In the recent past, the emphasis in manufacturing management was on materials inventories, ordering, and production lead times, labor and material efficiency, work-in-progress (WIP) levels, finished goods inventories, and so forth. The emerging emphasis in American manufacturing is on just-in-time (JIT) techniques. JIT production techniques emphasize the elimination of waste, which is defined as "any activity performed within a manufacturing company which does not add value to the product" (Maskell, l986b, p. 32). Within the parameters of this definition of waste are inventories, materials handling, quality problems, queues, shop floor delays, lead times, and unnecessary clerical and accounting procedures (Maskell, 1986a). The elimination or minimization of inventories, lead times, and

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cal that they also be reflected in standard costs. 2. The efficient use of materials. Industrial engineering departments typically establish how much of a specific material is required in a specific production process. Either process changes or careless workmanship may lead to deviations in the actual amounts of specific materials used in a production process. When the actual quantities of materials used in a production process deviate from the planned quantities of use, it is likely that variances between actual and standard costs for the particular product will begin to appear. 3. The labor mix. The labor mix determines how much of each specific skill should be used in the production process. When the labor mix is departed from in the production process, it is likely that variances between actual and standard costs will begin to appear. Changes in the labor mix may be caused either by management or at the production level, in an attempt to improve the product, or for some other apparently worthwhile reason. While such changes may well be supportable, it is critical that they also be reflected in standard costs. 4. The efficient-use of labor. Industrial engineering departments typically establish how much of a speci
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Approximate Word count = 7506
Approximate Pages = 30 (250 words per page)

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