We ran into this and have been talking to Sage support about it now and wondering if anyone else has experienced this and if so, any thoughts on how you corrected this? Work Order Planned Cost completion method does not calculate correctly if any additional work centers are posted to the work order for an existing step. If you create a firm planned work order with all material issued to step 05 so posting material to any step with labor is never an issue. A work center is always a specific machine. I am using only the labor and Fixed Overhead in my example. My item valuation for the parent item is LOT since we need to have traceability for the item. Create a work order making 1000 items and the planned cost for labor and overhead will be: Step # WC OP Labor Rate Fix OH Ops/Hr 10 C001 CUT $10.00/hr $20.00/hr 500 1000/500=2hrs x$10 =$20 labor $40.00 Fix OH 20 ASSY ASY $10.00/hr $20.00/hr 200 1000/200=5hrsx$10=$50 Labor $100.00 Fix OH WO1 will show $70.00 Labor and $140.00 for Fixed OH The WO is released and now WO1 has the same information but I have records in WOJ (WIP) for the 2 steps and that key includes the work center and operation code. A completion is done at the end of the day in preparation for shipping the item. There is no labor posting until the next morning. The lot unit cost will be $210.00/1000=$.210. This is correct. I completed 100 so my total cost is $21.00. I post labor in the morning and do another completion that night and the costs are still correct. I then get a labor card for a machine that is not on the routing for the WO. I go into WO entry and change the work center on step 10 to be C002 with operation code CUT. The labor rate is still $10.00/hr and Fixed OH is $20.00/hr with a operation / hr of 500… costs are all the same as the original step 10. My planned cost is the same in WO1 as it was prior to this change but now the correct work center is scheduled. Labor is posted to this new work center. WOJ now has an additional record for step 10. I complete 100 items and update. The cost for this completion is calculated using: 10 C001 CUT $10.00/hr $20.00/hr 500 1000/500=2hrs x$10 =$20 labor $40.00 Fix OH 10 C002 CUT $10.00/hr $20.00/hr 500 1000/500=2hrs x$10 =$20 labor $40.00 Fix OH 20 ASSY ASY $10.00/hr $20.00/hr 200 1000/200=5hrs x$10 =$50 labor $100.00 Fix OH Total Labor = $90.00 and total Fixed OH = $180.00. The total planned cost in WOJ=$270.00/1000= $.27 per item The item is completed into inventory at $.27 unit cost. THIS IS NOT CORRECT. WO1 still shows planned cost for labor as $70.00 and Fixed OH as $140.00. Why is the program looking at WOJ for a completion calculation? Machines break down all the time and need to be replaced with new machines on the work order. The new machine (WC) must be on the work order to have a rate (op/hr) or no cost is posted to the WO. Nothing is in place to prohibit a work center being used on a work order that does not have this work center on this step. This inaccurate posting is causing the cost of the items posting to inventory and the general ledger to show incorrect profit. Item profit, customer profit and Income Statement information is all incorrect. WIP is incorrect and the WO Close process is scary. Sage has suggested a work around of adding a new step for this new work center/operation. We would have to zero out the operations/hour on the original step or the planned cost will be overstated on the WO. This will change a lot of WO reports to show variances on the steps involved. Has anyone else got a solution to this issue?
↧