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Ray Carnes États Unis

--Ray Carnes--
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Beaumont, États Unis
--Ray Carnes--

Business Analyst - Custom Projects

https://www.linkedin.com/in/raycarnes

Ray Carnes États Unis
21/03/2019 00:29

V12?

The easiest way is to define a service Product called "Labor" with cost representing the hourly burden, or multiple Products if you have different labor rates.

When finishing up a Manufacturing Order, add the amount of Labor at the same time you get to adjust the initial BoM Quantities.


Worked Example:

1. Products A and B are in Stock with a Cost Price of $10 and $23 each, respectively:



2. Create a Labor Product as a Service:



3. Create your finished Product X with a Bill of Materials that includes A and B:



4. When completing the Manufacturing Order for X, add the number of Labor Hours:



5. Once you are done, the Cost Analysis Report of the Manufacturing Order shows:



6. The Inventory Valuation Report shows:



Since $99 worth of Materials [$10 + $10 + $10 + $23 + $23 + $23] went into Work In Progress (the Stock Output account on the A and B and the Stock Input account on X) and $147 worth of Materials and Labor [$99 + $75] came out, you have to move this amount out (probably in bulk at the end of the month) with a debit that is offset by a credit into a liability account (for example).

This is the Balance Sheet after everything above is done:



If you Shipped a unit of X and Invoiced your Customer, the Journal Entry would be:




It is possible to get more complex in the way you model and account for a labor burden, but this is the simplest way I know of.

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