ACCAchap6

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2. The Ordering, Receipt and Issue of Raw Materials
2.1 Raw materials control cycle
Materials requisition /returned returned note Cost centre 1 Cost centre 2 Cost centre 3 ………
Materials transfer note
The stores (receiving) department Purchase requisition 1 Copies of 3 purchase order
Delivery Goods note 4 received
The purchasing department
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3. The storage of raw materials
3.2 Recording inventory levels 3.2.2 Stores ledger accounts（材料分类账） 材料分类账） Stores ledger accounts are kept by cost department to keep track of inventory on hand.
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3. The storage of raw materials
3.4 The inventory count(stock-take) 3.4.2 Continuous stocktaking
It is counting and valuing selected items at different times on a rotating basis. It involves a specialist team counting and checking a number of inventory items each day, so that each item is checked at least once a year. Valuable items or items with a high turnover could be checked more frequently.
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3. The storage of raw materials
3.4 The inventory count(stock-take) 3.4.3 Advantages of Continuous stocktaking
The annual stocktaking is unnecessary and the disruption it causes is avoided. Regular skilled stocktakers can be employed, reducing likely errors. More time is available, reducing errors and allowing investigation. Deficiencies and losses are revealed sooner than they would be if stocktaking were limited to an annual check. Production holds-up are eliminated. Staff morale is improved and standards raised. Control over inventory levels is improved.
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3. The storage of raw materials
3.2 Recording inventory levels 3.2.1 Bin cards (卡片箱 卡片箱) 卡片箱 A Bin Card is kept with the actual inventory and is updated by the storekeeper as inventory are received and issued to provide an accurate record of the quantity at a particular stores location.
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Free inventory A wholesaler has 8,450 units outstanding for Part X100 on existing customers’ orders; there are 3,925 units in inventory and the calculated free inventory is 5,525 units. How many units does the wholesaler have on order with his supplier? A 9,450 B10,050 C13,975 D17,900
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1. Inventory Control
1.3 The reasons for inventory control Holding costs of inventory may be expensive. Production will be disrupted if we run out of raw material. Unused inventory with a short shelf life may incur unnecessary expenses ……
Chap6: Material Costs
© 2002 IBM Corporation
Chap6: Material Costs What is inventory control? The ordering, receipt and issue of raw materials The storage of raw materials Inventory control levels Accounting for material costs
1.2 Inventory control Inventory control includes the functions of inventory ordering and purchasing, receiving goods into store, storing and issuing inventory and controlling levels of inventory. The ordering of inventory The purchase of inventory The receipt of goods into store Storage The issue of inventory and maintenance of inventory at the most apprg, Receipt and Issue of Raw Materials
2.1 Raw materials control cycle Purchase requisition (请购单) Purchase order （订购单） Goods received note（商品收讫单） Materials requisition note（领料通知单） Materials transfer note（材料转移单） Materials returned note（退料单）
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3. The storage of raw materials
3.4 The inventory count(stock-take) 3.4.1 Periodic stocktaking It is a process whereby all inventory items are physically counted and valued at a set point in time, usually at the end of an accounting period.
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3. The storage of raw materials
3.4 The inventory count(stocktake 存货盘点) The inventory count (stocktake) involves counting the physical inventory on hand at a certain date and then checking this against the balance shown in the inventory records. Periodic stocktaking（定期/实地盘存制） Continuous stocktaking （永续盘存制）
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3. The storage of raw materials
3.3 Identification of materials: inventory codes (存货编码 存货编码) 存货编码 Advantages of using code numbers to identify materials are as follows: To avoid ambiguity To save time To improve production efficiency To facilitate computerized processing ……
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3. The storage of raw materials
3.2 Recording inventory levels 3.2.3 Free inventory Free inventory represents what is really available for future use. Units Materials in inventory X Adds: Materials on order from supplier Less: Materials requisitioned, not yet issued Free inventory balance X (X) X