The two production processes examined in this section are:
- Production planning and control. This process involves the logistics, or “physical” aspects, of converting raw materials into finished goods. As such, it concerns itself with the orderly and timely movement of goods through the production process. It includes activities such as planning material, people, and machine requirements; scheduling; routing; and monitoring progress of goods through the factory.
- Cost accounting. This system, like the first, also tracks work in process. However, the emphasis is on the flow of costs rather than on the goods’ physical flow.This system accumulates cost information for the purposes of product costing, inventory valuation, performance evaluation, cost control, and decision making.