Maintain Part Costs

Costs should be defined for all items that are purchased.  They can also be defined for items that are supplied by other warehouses.  If Product Costing is installed, costs cannot be defined for manufactured items; these costs will be calculated by the Product Costing module based on the bill of material (which supplies material costs) and the routing (which specifies how much labor is required at each workcenter to produce the item).  The Manufacturing Engineering module is used to define part routings and assign overhead cost elements to workcenters.

Procedures

1.   Decide what costs elements you want to track, and if you want any of the costs to roll up into groups.  Determine which of the detail cost elements are acquisition costs (paid to the vendor) or non-acquisition costs (inspection time, etc.).  Determine whether each element is a labor, material, or overhead cost.

2.   Define the cost elements on Reference File category C17.  You must define all elements that are associated with procurement costs.  If you wish, you can also define elements that will be assigned to workcenters in Manufacturing Engineering.

a.   Define the cost elements that will be used to group detail elements at the highest level.  Leave the Rollup Code blank.

b.   If intermediate groups will be used, define them from highest level to lowest level.  Use the Rollup Code field to specify the higher-level group where the cost element will be included.  Note that an element must already have been defined on category C17 before it can be entered in the Rollup Code field.

c.   Define the detail cost elements.

3.   Define the standard and current costs for each part.

a.   Select Part Costs from the Design Engineering Menu.

b.   Enter the part number on the Function Select screen.

c.   For each cost element, enter the current cost.  The standard cost may be entered here, or it may be established using the cost rollover functions in Product Costing.  Specify whether each element is acquisition or non-acquisition and whether it is a material, labor, or overhead cost.

4.   Use the Part Cost Inquiry to verify that the cost were entered correctly.

Continuation Steps in other Modules

1.   Define workcenter rates and miscellaneous costs within Manufacturing Engineering.

2.   Use the Cost Generation/Simulation Request Entry option within Product Costing to submit a batch request to generate the current costs for manufactured parts.  Note that this step should not be performed until product structures have been defined for the parts.

3.   Use the Cost Rollover option in Product Costing to establish standard costs based on current or simulated costs.  Or use the Cost Generation/Simulation option to generate standard costs.

4.   Use the Accounting Cost generation option in Inventory Accounting to generate accounting costs.