Procedure documentationIncluding Additional Costs to a Production Order Locate this document in the navigation structure

 

You can include additional costs, such as labor, machinery and overheads in the Production Order. To do this, include the freight as non-inventory items in the Bill of Materials (BOM). You can do this in both perpetual inventory and non-perpetual inventory systems.

Caution Caution

If you have installed a patch, or upgraded SAP Business One, and the non-inventory item does not have an associated WIP account, when you open a Receipt from Production window the system displays an error message. To solve this, open the Production window and choose Update.

End of the caution.

Procedure

  1. Set the Item to Non-Inventory.

    Choose   Inventory   Item Master Data  , and deselect Inventory Item.

  2. Set the Valuation Method to Standard (for perpetual inventory only).

    Choose   Inventory   Item Master Data  , select the Inventory Data tab, and in the Valuation Method field, select Standard.

  3. Defined Expense, WIP Material, and WIP Variance accounts (for perpetual inventory only).

    Choose   Administration   Setup   Financials   G/L Account Determination   Inventory   tab.

  4. Defined the Standard Cost for the Item (for perpetual inventory only).

    Choose   Inventory   Item Master Data  , select the Inventory Data tab and in the Item Cost field, specify the cost.

  5. Defined the Issue Method as Backflush.

    Choose   Inventory   Item Master Data  , select the General tab and in the Issue Method field, select Backflush.

    Note Note

    Non-inventory items must use the backflush issue method.

    End of the note.

  6. Add the non inventory item to the BOM.

    For more information, see Defining Bill of Materials (BOMs).

    • You can change the required additional costs value by changing the value in the Planned field.

    • You can set the price for the non-inventory item (for non-perpetual inventory only)

      Note Note

      A non-inventory item cannot be a by-product.

      End of the note.

Result

  • The Item WIP Material account is copied to the production order and cannot be changed.

    Note Note

    A subsequent change to the WIP Material account does not influence the production order.

    End of the note.

  • The expense account is taken from the Expense Account field on the Warehouse tab.

More Information

Production Orders