At Boulder Industries Budgets Are the Responsibility of Everyone

question 127

Essay

At Boulder Industries budgets are the responsibility of everyone. Each department collaborates in determining its expected needs and sales personnel determine the likely sales volume. Bart Gray one of the production managers believes in building plenty of slack into everything including his estimates of ending inventory of work in process.
Required:
You are the accounting manager. Write a memo to Mr. Gray. Explain why the ending inventory figure should be extremely accurate with as little slack as possible.

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Definitions:

Restrictive Indorsement

An endorsement on a negotiable instrument, like a check, that limits its use, such as specifying that the instrument must be deposited into a particular account.

Negotiates

The act of discussing something formally to reach an agreement, often in business or diplomatic discussions.

Collection System

A method or process used to gather or accumulate items, information, or debts from various sources.

Countermand

To revoke, cancel, or reverse an order or directive that has been previously issued.