Posted on by Nick Katko | No Comments
Creating value stream income statements is the second part of a lean decision making framework that is not based on a standard costing system. The value stream income statement is an essential element of lean decision making due to how lean practices & methods impact profitability. It’s important for accountants to understand the “lean logic”
Posted on by Nick Katko | No Comments
Using standard product costs in business decision-making works well in traditional manufacturing companies, because standard costing systems were designed for traditional manufacturing. In lean manufacturing companies, continuing to use standard costing for business decision-making will create conflict and confusion throughout the organization. One of two outcomes can occur when standard costs are used in business
Posted on by Nick Katko | No Comments
One of the most critical responsibilities accounting must assume, in a lean manufacturing company using a standard costing system, is to explain the financial impact of reducing inventory. Most manufacturing companies begin their lean journey with high levels of inventory. Through the deployment of lean practices and methods, inventory will be reduced. One of the