Hello:
Has anyone run into this error when running a BOM Cost Report. We are average cost on all parts and do not use the roll up process. We have not made a job for this part yet. We can’t find anything wrong with the part setup.
This method detail would create an endless loop in the Rollup Process - Part: 21-01771-11 Rev: A AltMethod: .
Someone correct me if I’m wrong … But you shouldn’t have to run the Cost Rollups unless you are using STD costing.
Using Last or AVG, the cost will be adjusted upon receipt to inventory. The cost used will be based on the costs of the materials and labor that have been issued to the Job.
For example:
Ignoring labor for a second
You use LAST costing
You have an assy named ASY-101
The parts in the BOM added up to $100 per finished part.
You have zero ASY-101 in inventory
The Last cost (from a prior production run) is $100
You issued all the parts to make 10 of ASY-101, the cost put in WIP is $1,000.
Now say you had to issue two part components (say they got damaged in the original build), totaling another $200 added to WIP Total in WIP is $1,200
When you receive those 10 ASY-101’s into stock, it will set the LastCost to $120
If you use AVG and there was zero QOH, that exact above would apply (except AvgCost would also be set to $120
If you use AVG and there were 5 of ASY-101 on hand, and the AvgCost is $1,000, the receipt to inventory would set the AvgCost to (5 x $100 + 10 x $120) / (5 + 10) = $133.33
If you use LAST cost and there was a QOH in inventory, the repeipt would mak a cost adjustment to a variance account to make up for the change in value of the existing stock.