In Cetec ERP, estimated cost is tracked on a per BOM, per Quote/Order/Job basis, segmented along the following lines:
- Sum of each component’s default cost * qty per top
- Total labor estimate * Default Labor Rate (Maintained in ADMIN » Config Settings » Config Settings and search for Labor Rate) (or)
- Location path estimate * Work location labor rate (Maintained in ADMIN » Maintenance » Data Maintenance » OrdlineStatus)
- Total labor estimate * Default Overhead Rate (Maintained in ADMIN » Config Settings » Config Settings and search for Overhead Rate) (or)
- Location path estimate * Work location overhead rate (Maintained in ADMIN » Maintenance » Data Maintenance » OrdlineStatus)
Estimated Misc Charges And/Or Outsource Fees
- Total amount of estimated outsource fees or misc charges (e.g. tooling, excess material, etc.)
Total Estimated Cost of a BOM
- Estimated material + estimated labor + estimated overhead + estimated misc charges
To understand Cetec ERP’s estimated costing, click on the BOM Overview link to the left side of a part screen. In it, you will see estimated material, labor, overhead, and total costs for building an assembly that trickles down into its sub-assemblies if the part is a multilevel BOM. To click on a sub-assembly’s costing information, click on the arrow to the left side of a subassembly to expand the table. To understand how multi-level BOMs are costed, please refer to the Multi-level BOM Costing section below.
Notice that for sub-assemblies/components we track two different kinds of costing. One is based off of subassembly’s default cost information, and displays under the Cost Record/Ext Cost columns and the other is based off of the sub-assembly/raw component’s own estimated cost, and displays under the Rollup column. Costing for the part you are looking at, which is displayed near the bottom right side of the screen, works off of the rollup values.
In Cetec ERP, actual cost is tracked per work order basis, segmented along the following lines:
- Sum of each picked component’s cost (Cetec ERP job cost details leverage actual receipt costs; for financial cost reports, Cetec can be configured to use either the actual receipt cost or the average cost of material, and may also be configured to post variances from actual receipt costs to standard costs in a variance account on your financial statements)
- Actual labor (Sum of all labor segments added) * Work location Labor Rate (Maintained in ADMIN » Maintenance » Data Maintenance » OrdlineStatus)
- Alternatively to actual labor, Labor estimate (via total labor estimate or location path estimate) * Default Labor Rate (Maintained in ADMIN » Config Settings » Config Settings and search for Labor Rate) may be posted by using the Apply Labor estimate checkbox at the time of closing an order.
- Actual overhead (Sum of all overhead segments added) * Work location Overhead Rate (Maintained in ADMIN » Maintenance » Data Maintenance » OrdlineStatus)
- Alternatively to actual overhead, overhead estimate (via total overhead estimate or location path estimate) * Default Overhead Rate (Maintained in ADMIN » Config Settings » Config Settings and search for Overhead Rate) may be posted by using the Apply Labor estimate checkbox at the time of closing an order.
- Sum of outsource labor added to an outsource PO (See: http://www.cetecerp.com/support/how-to/outsourcing.html)
Calculation of actual cost, costing overview, and cost edit
In Cetec ERP the estimated cost of a BOM does not always match its actual cost in manufacturing it. This is because the estimated cost works without specific data as to what parts were consumed and how much labor has been logged.
The actual cost of an order gets calculated at the point of closing (i.e. invoicing or complete/receiving) an order. This is the cost that displays on invoice and updates accounting. If you are working with an internal build for stock order, then at the point of invoicing the corresponding internal PO would be received in automatically with this actual cost as its receipt cost.
To get an overview of actual invoice costing, click on the Details/Serials link to the left side of an invoice screen. This screen will break down costing and give you an overview of how Cetec ERP came up with its values. NOTE! If your order/job used materials from subassemblies and/or multi-level BOMs, use the “View Cost Details” screen for a thorough breakdown and aggregation of all subassembly (and constituent materials/labor/overhead/outsource costs) that were used in the top level job / project / order. This report is useful when needing to aggregate multi-level build structures used against a single parent project or sale.
You can also opt to change any of these costing values by going into the Invoice Edit screen. You will see the costing section divide into four fields: Material, Labor, Overhead, and Outsource. By putting in numbers here you can choose to override any number that Cetec ERP has generated. Beware that editing costs could have far reading implications e.g. editing costs for an internally built assembly which has been consumed already.