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Business value
The system accurately calculates standard costs for produced items with specific variants or locations by using stock-keeping units (SKUs). This improvement makes costs more precise when you assign production bills of material (BOMs) and routes to SKUs. You can also include noninventory items in production cost calculations, so you get a more complete view of cost shares.
Feature details
Include noninventory costs in finished goods
With this release, you can include noninventory items in the cost of produced items for both actual and standard cost scenarios.
Setup
To start using this feature, go to the Manufacturing Setup page and turn on the Include Non-Inventory Items to Produced Items toggle.
When you turn on this feature, the cost of non-inventory items is part of the cost of produced items. The cost appears as an extra value entry that relates to the item ledger entry of the type Output. You must also configure the corresponding balancing accounts.
The following table shows the relationship between the new types of inventory value entries and the accounts and balancing accounts in the general ledger.
Item Ledger Entry Type | Value Entry Type | Variance Type | Expected Cost | Account | Balancing Account | Comment |
---|---|---|---|---|---|---|
(Production) Output | Direct Cost - Non Inventory | No | Inventory | Direct Cost Non-Inventory Applied Account | Similar to item indirect cost | |
(Production) Output | Variance | Capacity Overhead | No | Inventory | Material Non-Inventory Variance Account | Similar to other variance accounts |
Use
You can explore the effect of non-inventory items on the cost of produced items on the BOM Cost Shares page, where you can use the Rolled-up Material Non-Inventory Cost and Single-level Material Non-Inventory Cost fields.
After you post, you can find the amounts in the value entries and general ledger entries.
Note
These changes don't affect assembly orders. You can consume the non-inventory items without impacting the cost of the assembled item.
Use standard cost from versions for production output
Define a production BOM or routing in the version. This setup is useful when a version represents a different variant that requires a different set of components or a different location with other production equipment. These changes can affect cost.
Setup
To turn on this feature, go to the Manufacturing Setup page and select the Load SKU Cost on Manufacturing toggle.
Usage
Use the Calc. Production Std. Cost action in the Stockkeeping Unit Card page to calculate the standard cost.
The action fills in these fields:
- Single-level Material Cost
- Single-level Capacity Cost
- Single-level Material Non-Inventory Cost
- Single-level Subcontracted Cost
- Single-level Manufacturing Overhead Cost
- Single-level Capacity Overhead Cost
- Rolled-up Material Cost
- Rolled-up Capacity Cost
- Rolled-up Material Non-Inventory Cost
- Rolled-up Subcontracted Cost
- Rolled-up Manufacturing Overhead Cost
- Rolled-up Capacity Overhead Cost
Note
- For subassemblies, the system uses information from item cards.
- The standard cost worksheet doesn't support stockkeeping units.
When you post the output for an item that has a stockkeeping unit, the standard cost uses information from the stockkeeping unit.
Tell us what you think
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Additional resources
learn.microsoft (docs)