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Adding Labor and Burden to Item Cost and W/O
08-24-2018, 08:41 AM, (This post was last modified: 08-24-2018, 12:16 PM by phil.)
RE: Adding Labor and Burden to Item Cost and W/O
It is true we don't have routings per se.... However, we do have labour type items and we can define how many minutes/hours of each labour type item are required in a BoM. If it is not routings as per traditional software - it really acheives the same things I think.

In manufacturing we typically want to monitor the cost of each type of labour per productive hour and often this cost includes the overhead of running the department so is loaded to ensure manfuacturing overheads are recovered in the cost of what is manufactured - so setting up an item for each type of labour or department/cost centre. The cost would require some assumption about a normal level of production as the rate would be reported as lower where more hours are booked to jobs and most often this relates to when the factory is busy or not - such is the nonsense of full absorption costing. (IFRS stock/inventory valuation requires manufacturing overheads to be included in the cost of manufactured items)
Perhaps designers, engineers, project managers, fabrication, welding, assembly or whatever. The cost of each type of labour is captured in the GL with the posting of the payroll. Then the issue of time to each job creates a recovery credit in the GL account defined in the stock categories - see how the labels in this form change when the stock category is defined as a labour type - now you can enter P & L recovery account - the total of recoveries in the P & L then compare to actual costs and with a bit of formatting of the GL accounts you can get a under/over-recovery and see if your labour rates make sense. The labour rate being the "cost" of your labour items. The recovery amount being the labour cost x the quantity of labour issued to the work order.

Maybe I was trying to be clever here using the existing functionality to have these labour type items - that we can include with quantities in BOMs - AKA routings!!!

I had envisaged an employees table with employees mapped to a labour type item and a time-sheet entry interface to enter time on each job for each person.
This is the bit we are missing as Bryce points out. A nice time-sheet entry program or phone app that - ideally with manager review - before being sucked into work orders, and some nice reporting on labour type items showing people under a particular labour type item - their productivity on jobs and overall.

Labour type items are reported in work orders - maybe this could be tweaked but it works pretty well.

You could also extend this for capacity planning with the time known for each item on order from the BOM and extended for the quantites on order ....
Phil Daintree
webERP Admin
Logic Works Ltd

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RE: Adding Labor and Burden to Item Cost and W/O - by phil - 08-24-2018, 08:41 AM

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