After studying this chapter, you should be able to: Describe the major business activities and related information processing operations performed in the production cycle; identify major threats in the production cycle and evaluate the adequacy of various control procedures for dealing with those threats; explain how a company’s cost accounting system can help it achieve its manufacturing goals. | Chapter 14 The Production Cycle Copyright © 2012 Pearson Education 14-1 Learning Objectives Describe the major business activities and related information processing operations performed in the production cycle. Identify major threats in the production cycle and evaluate the adequacy of various control procedures for dealing with those threats. Explain how a company’s cost accounting system can help it achieve its manufacturing goals. Discuss the key decisions that must be made in the production cycle and identify the information required to make those decisions. Copyright © 2012 Pearson Education 14-2 Production Cycle Copyright © 2012 Pearson Education 14-3 The Production Cycle Business activities and information processing activities Related to manufacturing of products Copyright © 2012 Pearson Education 14-4 Production Cycle Activities Product design Planning and scheduling Production operations Cost accounting Copyright © 2012 Pearson Education 14-5 Production Cycle General . | Chapter 14 The Production Cycle Copyright © 2012 Pearson Education 14-1 Learning Objectives Describe the major business activities and related information processing operations performed in the production cycle. Identify major threats in the production cycle and evaluate the adequacy of various control procedures for dealing with those threats. Explain how a company’s cost accounting system can help it achieve its manufacturing goals. Discuss the key decisions that must be made in the production cycle and identify the information required to make those decisions. Copyright © 2012 Pearson Education 14-2 Production Cycle Copyright © 2012 Pearson Education 14-3 The Production Cycle Business activities and information processing activities Related to manufacturing of products Copyright © 2012 Pearson Education 14-4 Production Cycle Activities Product design Planning and scheduling Production operations Cost accounting Copyright © 2012 Pearson Education 14-5 Production Cycle General Threats Inaccurate or invalid master data Unauthorized disclosure of sensitive information Loss or destruction of data Copyright © 2012 Pearson Education 14-6 Production Cycle General Controls Data processing integrity controls Restriction of access to master data Review of all changes to master data Access controls Encryption Backup and disaster recovery procedures Copyright © 2012 Pearson Education 14-7 Product Design Threats Poor product design resulting in excess costs Copyright © 2012 Pearson Education 14-8 Product Design Controls Accounting analysis of costs arising from product design choices Analysis of warranty and repair costs Copyright © 2012 Pearson Education 14-9 Planning and Scheduling Threats Over- or underproduction Copyright © 2012 Pearson Education 14-10 Planning and Scheduling Controls Production planning systems Review and approval of production schedules and orders Restriction of access to production orders and production schedules Copyright © 2012 Pearson Education .
