MRP Consumed Labor

Description

This module adds labor cost to the cost of a manufactured product based on the work center's hourly rate and expenses’ labor expense account.

Configuration

Work centers must be configured through Manufacturing - - > Settings - - > Work Centers.

Configuring Labor Expense Account for two work centers as shown below.

On the Work Centers, set:

• Cost per hour
• Labor Expense Account

On the Product Category Settings, set:

• Inventory Valuation = Automatic

Functionality

When manufacturing a product the cost of labor will be added to the cost. This cost will be updated on the product template depending on the costing method assigned in the product category.

For Example, if the average cost method is set, the cost on the product template will be recalculated using the cost of the manufactured item (Components + Labor).

The Labor cost will be added to any product cost with a work center that has a cost per hour and a labor expense account filled in. This will be calculated automatically based on the real duration of the work center.

Create a manufacturing order and after confirming the order, Click on Valuation.

Select the Manufacturing Product Link.

Under Other Info Tab, Click on the Journal Entry.

The Journal Items for the components stay the same i.e, Credit Stock Interim Account and Debit Stock Valuation Account.

The new Journal items Credit the expense account and debit the stock interim account.

The Cost on the product template will be updated accordingly (this will be different per costing method).

Credits

Contributors

• Sodexis <apps@sodexis.com>

This module is maintained by Sodexis.s.