Riordan Manufacturing Revenue Cycle Essay example

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Riordan Manufacturing Revenue Cycle Accounting information systems provide the tools to operate and maintain important data related to an organization and interpret the information to develop quality financial reports. The revenue cycle of Riordan Manufacturing reflects sales and the components associated with sales such as inventory, freight, cost of goods sold and accounts receivable, yet this information is not readily available to each facility. Because the forecast for the company is positive and production and wages are expected to increase having source documents available within each branch of the company would improve the efficiency of the organization. Developing a plan to integrate an accounting information system for the…show more content…
The company also tracks non-traditional information such as quality assurance costs, research, and development. At this time, Riordan Manufacturing has three operating entities in Georgia, Michigan and California. Riordan also has a joint venture in China. Each operating entity keeps independent financials including a general ledger, accounts payable and receivable, order entry, procurement, sales and purchasing history, invoicing and shipping, payroll, and financial reporting. The advantage of having each unit run as its own business is that each unit knows its customers and its relationship with its customers. They are able to establish personal contact with both customers and vendors, report on payments and receivables from these customers, and follow the accounting through to the general ledger. Payroll is handled locally which increases the understanding of shifts, over time, and labor hour accounting. Advantages of local order entry is the fact that the individual unit knows the product or products that it produces and is able to help the customer with the knowledge of the manufacturing process and how it affects the accounting process. Keeping the invoicing and shipping localized is advantageous in that it keeps it cohesive and easy to find errors. The financials will come together from individual manufacturing divisions to form a reliable source of accurate financial reporting; therefore, the
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