I have a request to ascertain impact to inventory valuation due to changes in standard rates and costs in a timely/systematic manner, to take place prior to our annual standards roll process.
As Epicor has limited cost fields/rate fields - we would not want to overwrite (standard cost) with changes for estimate. A copy of the production environment would allow us to manipulate the cost fields/rate fields without jeopardizing the integrity of the standard cost fields/rates in production environment.
Lower level costs on manufactured items lose their material-labor-burden identity, so unable to manipulate manufactured items in excel.
Is anyone out there doing any cost simulations or What If Cost Analysis? If so, how do you do it?
Weâve been able to do this without needing to copy the database, the standard cost changes donât take effect until the cost group is posted.
You can use a BAQ to compare the values in the CostPart table (ânewâ costs) against the PartCost table (current standard cost). We do this for every part in a given cost group, then multiply by the qty on hand to give us an overall cost impact of the rollup prior to posting.
In addition to Nathanâs excellent suggestion, a Part can have multiple Cost IDs. The default ID is â1â but others have created â2024â, âWhatIfâ, etc. This feature is used for multisite because the cost can be different for each site, but it is possible for one site to have multiple CostIDs as well. Only one is set for accounting, the Siteâs Default Cost ID. You can create new Cost IDs in the Costing Workbench. When ready, you can load one Cost ID and post to the default.
We are prepared to start doing what Mark is advocating here- at least for our quoting side. We will roll and post methods to a cost site ID that is our current cost (which is based on last, weighted averages, etc., whatever we want that to be). Itâs mainly for quoting. Thatâs one aspect we are dealing with.
The other side of it is, what happens if material X goes up by $2?
Well I do what @ServantOMallard said. I do a where used report on all the places where part X is used. Then I load all those parts into the costing workbench and I update the standard cost of material X and then I do a roll.
Then I print the cost group report to see what finished parts have changed and by how much.
Then I either use historical sales data or forward looking forecasts to project what the impact of the $2 cost is going to be.
Due to some bad practices with Revs, my process is a lot tougher than this, but in a nutshell thatâs what I am doing for material cost change impact. Same could be done for a method of manufacturing change though.
For parts on the fly, I just look through part tran and see how much of material X we issued to parts on the fly since those donât have a standard cost and I pretty much say, if we expect the next 12 months to be like the last 12 months in terms of parts on the fly that use material X, then the impact will be X on the bottom line.
Some of it is pretty naive, but itâs a relative glimpse at possible impacts.
I just started using a UD table to hold a monthly fifo, last average and standard of the bom material to compare to current.
This catches when several materials go up by small amounts, but the overall impact is going to reduce margin since the assembly has a price for the entire contract.
We did some testing today and I am puzzled with the cost site id not on one of our sites. We have a Cost ID (the default) setup on site MfgSys. When I look at the Plant.PlantCostID field it is blank. All of our other sites have a cost id on them. This makes me wonder how the cost in MfgSys are correct (which they are)?
