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A bill of material defines what a finished item consumes. A production run consumes those components from stock and produces the finished item, posting both movements to the ledger at the same moment.
Cost accumulates against the run rather than being allocated to it afterwards.
Because the shop floor tracks output and the ledger tracks purchases, and converting one into the other is a monthly exercise in apportionment. Component cost, labour and overhead are estimated onto units after the fact.
The unit cost that results is defensible and approximate, and it is the number pricing decisions get made on.
Unit cost is derived from what was actually consumed, including variances against the bill of material. A run that used more than it should shows as a variance rather than disappearing into an average.
Finished goods enter stock at a real cost, so margin on the eventual sale is real too.
This is manufacturing accounting, not an MRP or shop-floor system. There is no capacity scheduling, work-centre routing or machine-level tracking.
Multi-level bills of material are supported; complex configure-to-order product structures are not something this page claims.
Build one product end to end and run it before importing the rest. A bill of material that is subtly wrong produces a variance every single run, and the pattern is easier to spot on one item.
Agree how you treat labour and overhead before the first run, because retrofitting it re-costs history.
Inventory, for component consumption and finished goods. Purchasing, for the components bought in. The ledger, for work in progress and cost of goods. Where a production run belongs to a customer order, project cost in Loop can read it.
A bill of material defines what a finished item consumes. A production run consumes those components from stock and produces the finished item, posting both movements to the ledger at the same moment.
Unit cost is derived from what was actually consumed, including variances against the bill of material. A run that used more than it should shows as a variance rather than disappearing into an average.
This is manufacturing accounting, not an MRP or shop-floor system. There is no capacity scheduling, work-centre routing or machine-level tracking.
Build one product end to end and run it before importing the rest. A bill of material that is subtly wrong produces a variance every single run, and the pattern is easier to spot on one item.
Fourteen days, every module, no card. Or half an hour with someone who will run it on your own records and tell you where it does not help.