production cycle

production cycle

1. product design

   • bill of material
     • specifies the part number, description, and quantity of each component used in a finished product
   • operations list
     • specifies the sequence of steps to follow in making the product, which equipment to use, and how long each step should take

2. planning and scheduling

   • Master production schedule
     • specifies how much of each product is to be produced during the planning period and when that production should occur
   • production order
     • which authorizes the manufacture of a specified quantity of a particular product
   • materials requisition
     • authorizes the removal of the necessary quantity of raw materials from the storeroom to the factory location where they will be used
   • move ticket
     • a document that identify the internal transfer of parts , the location and time of the transfer.
   • see slide

3. Production Operations

   • use various forms of IT : robots, Computer integrated manufacturing CIM

4. Cost Accounting

   • Job-order costing
     • costs assigned to a specific production job or batch
   • Process costing
     • costs assigned to each process in the production cycle and averages costs for all units produced
   • Activity-based costing
     • tracing costs to the activities than to products using cost driver
       • cost driver: measure of cost incurred in each activity