Computerized Manufacturing Systems Chapter M6 Computerized Manufacturing Systems PowerPoint Presentation by Douglas Cloud Professor Emeritus of Accounting Pepperdine University © Copyright 2005 South-Western, a division of Thomson Learning. All rights reserved. Task Force Image Gallery clip art included in this electronic presentation is used with the permission of NVTech Inc.

Once you have completed this chapter, you should be able to: Objective 1 Identify the primary modules of a computerized manufacturing system.

Components of an Accounting Information System Sales and Customer Relations Purchasing and Materials Management Vendors Production Customers Human Resources Employees General Ledger/ Financial Reporting Asset Management Financial Management Exhibit 1 Other Stockholders Creditors and Owners

Components of an Accounting Information System The sales module receives sales orders from customers and maintains accounts receivable information.

Components of an Accounting Information System Sales and Customer Relations Purchasing and Materials Management Vendors Production Customers Human Resources Employees General Ledger/ Financial Reporting Asset Management Financial Management Exhibit 1 Other Stockholders Creditors and Owners

Components of an Accounting Information System The purchasing and materials management module provides purchase orders to vendors. This module is especially important for keeping track of the costs and use of raw materials.

Components of an Accounting Information System Sales and Customer Relations Purchasing and Materials Management Vendors Production Customers Human Resources Employees General Ledger/ Financial Reporting Asset Management Financial Management Exhibit 1 Other Stockholders Creditors and Owners

Components of an Accounting Information System The human resources module maintains data about employees, hours worked, and wage rates. It is used for preparing payroll and payroll tax information.

Components of an Accounting Information System Sales and Customer Relations Purchasing and Materials Management Vendors Production Customers Human Resources Employees General Ledger/ Financial Reporting Asset Management Financial Management Exhibit 1 Other Stockholders Creditors and Owners

Components of an Accounting Information System The production module tracks the flow of costs through the manufacturing process.

Components of an Accounting Information System Sales and Customer Relations Purchasing and Materials Management Vendors Production Customers Human Resources Employees General Ledger/ Financial Reporting Asset Management Financial Management Exhibit 1 Other Stockholders Creditors and Owners

Components of an Accounting Information System The asset management module identifies long-term asset costs, their expected useful lives, and where these assets are located in the company.

Components of an Accounting Information System Sales and Customer Relations Purchasing and Materials Management Vendors Production Customers Human Resources Employees General Ledger/ Financial Reporting Asset Management Financial Management Exhibit 1 Other Stockholders Creditors and Owners

Components of an Accounting Information System The financial management module keeps track of debt, when repayment is due, interest rates, and shareholders information. Also, it is used for managing a company’s cash flows.

Components of an Accounting Information System Sales and Customer Relations Purchasing and Materials Management Vendors Production Customers Human Resources Employees General Ledger/ Financial Reporting Asset Management Financial Management Exhibit 1 Other Stockholders Creditors and Owners

Components of an Accounting Information System The general ledger/financial reporting module provides information for use by external stakeholders, including shareholders and government regulators

Components of an Accounting Information System Sales and Customer Relations Purchasing and Materials Management Vendors Production Customers Human Resources Employees General Ledger/ Financial Reporting Asset Management Financial Management Exhibit 1 Other Stockholders Creditors and Owners

Modules Available in SAP Financial Accounting Financial system for recording of transactions General ledger for maintaining account balances and preparing financial statements Accounts payable for tracking amounts owed to vendors Accounts receivable for tracking amounts owed by customers Treasury for cash flow management Consolidation for consolidation of a parent company’s subsidiaries

Modules Available in SAP Controlling Cost center accounting for determining the costs of specific functions or divisions of a company Internal order accounting for tracking the flow of costs among functions or departments within a company Continued

Modules Available in SAP Controlling Product costing analysis for determining and evaluating product costs Profitability analysis for evaluating divisional and product profit performance Activity-based costing for determining activity-based costs and allocation of overhead in the manufacturing process

Modules Available in SAP Asset Management Maintenance and repairs for tracking costs and timing of these activities Sale of assets for monitoring disposal decisions Asset replacement for evaluating replacement decisions Continued

Modules Available in SAP Asset Management Depreciation for determining and tracking asset depreciation for financial reporting, cost, and tax purposes Investment management for making decisions about new acquisitions or replacements of property and equipment

Modules Available in SAP Project Management Funds and resource management to help project managers keep track of resources used in a project Quality control to help with including quality issues in a project Time management to assist in scheduling activities associated with a project

Modules Available in SAP Human Resources Recruitment for keeping track of job requirements and postings Benefits for tracking employee benefits Time management for determining and scheduling employee labor hours Incentive wages for determining bonuses Continued

Modules Available in SAP Human Resources Business trip management for maintaining reimbursement information and determining travel costs Payroll for processing employee wages Training and events management for coordination of training activities Continued

Modules Available in SAP Human Resources Personnel development for tracking development activities for individual employees Workforce planning for determining labor and labor cost requirements for various functions or divisions

Modules Available in SAP Quality Management Quality inspection for monitoring quality control Quality planning for determining quality control requirements

Modules Available in SAP Production Planning Bills of material for identifying the materials that are used in each product Master production scheduling for determining the use of equipment and labor in the production process Material requirements planning for coordination the amount and availability of materials for scheduled production runs Continued

Modules Available in SAP Production Planning Shop floor control for coordinating the flow of materials through the production process Production orders for tracking order status and completion dates Product costing and activity-based costing for determining the costs of units of production

Modules Available in SAP Materials Management Material procurement for purchasing materials and maintaining vendor data Inventory management for determining inventory availability and costs Reorder point processing facilitates determining when to reorder and placing orders Continued

Modules Available in SAP Materials Management Invoice verification tracks orders and ensures company policies are followed in the ordering process Material valuation provides for identifying quality or quantity problems with materials received Vendor evaluation for monitoring vendor quality Continued

Modules Available in SAP Materials Management External services procurement for facilitating the outsourcing of services Warehouse management for maintaining data about the location of materials and for transferring materials into and out of the warehouse

Sales and Distribution Modules Available in SAP Sales and Distribution Inquiry processing for responding to customer inquiries Quotation processing for providing pricing information to customers Sales order processing for recording and tracking sales orders Continued

Sales and Distribution Modules Available in SAP Sales and Distribution Delivery processing for recording and tracking delivery of goods to customers Billing for submitting sales invoices to customers

Automating the Value Chain Exhibit 2

Once you have completed this chapter, you should be able to: Objective 2 Describe the components of a computerized information system used to process data in a manufacturing company.

Data Processing in a Computerized Information System Exhibit 3

The use of computer networks, like the Internet, to provide for customer sales is referred to as E-business.

Application software includes the computer programs that permit data to be recorded and processed.

A database is a set of computerized files in which company data are stored in a form that facilitates retrieval and updating of the data.

A database management system controls database functions to ensure data are recorded properly and are accessed only by authorized users.

Computer networks include the cables that connect the clients and servers and the hardware and software needed to make the networks function properly.

Customers and Suppliers Exhibit 4 An Illustration of a Computer Network

Accumulating Production Costs Materials Management Direct Materials Direct Labor Manufac-turing Overhead Job or Period Divide by Number of Units in a Job or Period Human Resources Unit Costs Asset Management and Other Exhibit 5

Accumulating Production Costs Materials Management Direct Materials Direct Labor Manu-facturing Overhead Job or Period Unit Batch Product Facility Levels Divide by # of Units in a Job or Period Human Resources Unit Costs Asset Management and Other Exhibit 6

Once you have completed this chapter, you should be able to: Objective 3 Explain the use of relational databases to perform product cost functions.

A relational database is a set of related files that are linked together so the files can be updated and information can be retrieved from the files efficiently.

Each attribute is referred to as a field in the table. A relational database is stored in tables or files that contain data represented by rows and columns. Each attribute is referred to as a field in the table. Each table contains one or more primary keys that uniquely identify the entities or processes recorded in rows of the table and connects the tables into relationships.

Copying and Opening the Database It is highly recommended that the database be copied to a hard drive before it is used.

Copying and Opening the Database It is a good idea to make several copies of the database under different names. KiwiOil1.mdb,KiwiOil2.mdb, etc.

Example of a Table in a Database Exhibit 8

Example of a Form for Data Entry Exhibit 9

Chapter M6 THE END