Accounting in the Lean Enterprise : Providing Simple, by McVay, Gloria; Kennedy, Frances; Fullerton, Rosemary PDF
By McVay, Gloria; Kennedy, Frances; Fullerton, Rosemary
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Extra resources for Accounting in the Lean Enterprise : Providing Simple, Practical, and Decision-Relevant Information
Explain why reducing inventories has a negative effect on the bottom line. How can management accountants support the lean concept of flow and pull? How do budgets and variances affect continuous improvement? What role do accountants play in employee empowerment? What are some of the major stumbling blocks in changing the internal reporting system? Should lean accounting be implemented by all firms? Discuss. What are some of the requirements for and differences in valuing inventory under a lean accounting system?
6*300,000). These calculations fit with a lean environment; they are simple, quick, and visual. Oftentimes, companies have various products in a value stream that require a disproportionate amount of resources that may be constrained or expensive. In these situations, it is necessary for decision-making purposes in determining product mix to identify the extra costs to build the more (less) expensive products. A cost for the constrained resources needs to be determined and the different costs for use of those resources should be assigned to individual products.
How do we assign the expense of these monuments? Lean accountants try to avoid allocations, but there are situations where it may be necessary to assign (allocate) monument costs to value streams. If this is the case, it is best to choose some measure that motivates the type of behavior you want in a lean environment. Most companies recognize the need to free up capacity—and thus, if it is necessary to allocate monument costs, they will often do it per the percentage of plant square footage used by the value streams.
Accounting in the Lean Enterprise : Providing Simple, Practical, and Decision-Relevant Information by McVay, Gloria; Kennedy, Frances; Fullerton, Rosemary