Robotic Medical Systems Robotic Medical Systems is a manufacturer and seller of quality medical equipment and devices located in Lexington, Massachusetts. The company has been serving hospitals and clinics nationwide since 1995. In recent years, its profits have declined due to increasing inventory and overhead expenses. This has caused the company’s board of directors to re-examine the organization’s accounting system in order to discover the reason for the rising costs. 

The following provides a description of the company’s conversion cycle:

Production schedule development: The firm’s production planners generate a schedule based on a sales forecast created by the firm’s marketing department. Once the production schedule is established, it must be approved by the production manager. The production planning department further reviews the production schedule for shipment delays on a monthly basis. 

Work order: Independently verified, prenumbered work orders are then used to initiate the manufacturing process. 

Raw materials issuance: The inventory control clerk must approve material requisitions based upon the bill of materials by checking the quantities and descriptions of items listed. Upon issuance of the raw materials from the storeroom, a copy is sent to inventory control where an entry is made to transfer the raw materials costs to work-in-process inventory. A production supervisor is responsible for approving and documenting any request for additional materials, and any unused material is documented and returned to the storeroom. 

Raw material conversion to products: Company employees use prenumbered move tickets approved by management to authorize the work in process to move to the next area. 

Such documents are based on bills of material and route sheets and are used to add the related cost to the work-in-process inventory to cost accounting. A copy of each move ticket is sent back to production planning and control to update the open work order file. 

 Draw a flowchart for this problem.

Answer rating: 100% (QA)

Explanation The conversion cycle of Robotic Medical Systems starts with the development of a product... View the full answer