TPD6020 - Manufacture: Materials to production

For reasons of efficiency a manufacturer will try to minimise the length of time that materials are held in stock before being fed into the production process. In a typical factory materials will be ordered from stock by means of a requisition, authorised by the production manager, and the relevant stock account will be updated. The requisition will then be priced and passed to the accounting department in order that the cost accounts can be adjusted. A “materials transfer note” may accompany the materials as they move through the factory.