Managerial Finance

Managerial Finance

Part 1

In order to response to the email of Andrew, the following prescription for control systems has been given in the reply which will reduce the sales expenses and increase the productivity of the company. As we know that the concept of Control system is to ensure that actual activities conform to planned activities. Let's keep the organization or system on track. There are four factors that must be considered in applying the control process Amount, Time, Cost and Quality.

Amount

Time

Cost

Quality

Budgets

Time studies

Budgets

Performance Evaluation

Estimates

Deadlines

Cost per square meter

Psychological testing

Finished goods

Programs

Standard costs

Visual Inspections

Units Sold

Time - machine

Forecasts

Coefficients

Rejected units

Work measurement

Accounting

Performance of staff

Personality Inventory

Procedures

Productivity

Reports

Work measurement

Standards

S performance / investment

Procedures

Forecasts

 

 

Standards

Inventory Control

 

 

Merit rating

Looking at the above chart, we will focus on the quality and cost which is Standardization. The current business grows fast when they have good relationship with the supplier. Hence, in return supplier looks for better product and high degree of reliability with respect to the quality of the products that are marketed. Quality is not absolute magnitudes which influenced by subjective conditions, but are the variables that need to have a system to serve as a link between buyers and sellers, in order to generate basis techniques for good commercial understanding, such as metrology, the standards and the control of quality (literature.rockwellautomation.com).

It is important to point out the functions that will fulfill the good or service being acquired and well know manufacturer that has potential to meet the expectations of customers. This creates the appearance of different levels of quality and price. The successes of all these aspects are to ensure the expected quality which lies in the set of technical regulations. These are recognized and adhered to form rules for system. This understanding and control system is called normalization. A poor relationship between buyer and manufacturer is due to the absence of mechanisms which ensure the reliability and quality of products and materials (Weygandt J., Kieso, et al., 2002).

The Organization manufacturer is responsible for the quality of their products and legally liable for their production if they bear any fraudulently and that does not meet the standard. The process has the following sequence:

The manufacturer of a product wishes to choose the "seal of approval" and heads the agency that administers it.

The body shall be responsible for checking, by direct or by the action of others, if the applicant makes the product hits the market in compliance with existing regulations. In the case that there was no national standard for the product, the first step is to develop the regular channels of standardization, which is based on the text of a rule of business , an international standard or a fast scheme suggested. To check the quality of the product are examined in the plant samples taken at random as the market for a time reasonable.

Simultaneously evaluating the control system used by the manufacturer during production, in order to avoid the declining risk regarding the quality of the product over a certain period, but without the guarantee that the quality may not be ...