Cost headings

This feature is used with: Bill of Materials, Estimating, Works Orders.

About cost headings

When calculating the cost of BOM A stock assembly and process costing system, which provides facilities to specify the structure of finished items in terms of sub-assemblies and components.s, estimates Forecast project costs, based on expected costs of labour, machinery and operation times. In Manufacturing, estimates are produced for one-off items or non-repetitive batches. or works order The authority to produce a part using the components specified on a BOM and the process specified on the routing.s, the values are accumulated in a cost heading.

Use this window to set up your cost headings. Five cost headings are supplied by default:

Labour.
Machine.
Materials.
Subcontract.
Tooling.

Cost headings are associated with cost elements in the following way and the most appropriate cost type is applied automatically:

Cost Heading	Cost Elements	Where	Cost Type
Labour	Labour Resources	Labour Resource Record Labour Resource Group Record	Labour
Machine	Machine Resources	Machine Resource Record Machine Resource Group Record	Machine
Materials	Stock Items	Stock Item Record Product Group	Materials
Subcontract	Operations where the Subcontract check box is selected.	Operation Record	Subcontract
Tooling	Tool Resources	Tool Resource Record Tool Resource Group Record	Tooling

Associating cost headings with cost heading types allows you to group cost headings and amalgamate costs during reporting.

Note:

You cannot associate a cost heading of type Materials with:

Labour Resources.
Labour Resource Groups.
Machine Resources.
Machine Resource Groups.
Tool Resources.
Tool Resource Groups.
Operations.

You cannot associate a cost heading of any type, other than Materials, with a stock item or product group.

To do this, you must set up your own cost heading, such as Tooling Materials, and associate this with a stock item in the Stock Item Manufacturing tab.

To maintain cost headings

Open: Manufacturing System Manager > Settings > Cost Headings.

To add user defined cost headings, click Add and enter the Name of the cost heading.
For each user defined cost heading, select the Type.
For each cost Name, enter the following default information.
- Markup %: Enter a markup percentage. This value is used when calculating a suggested selling price during costing operations.
  
  The suggested selling price has no effect on any other figures.
- Overhead Recovery %: Enter the percentage to be recovered for the different expense types.
  
  Set to 0 (zero) to suppress overhead calculations for a cost type.
- Nominal Account: Select the group default nominal account for posting all costs for the cost heading.
  
  Note: You must enter a Nominal Account for all cost heading Names, except for materials cost headings, even if you do not intend to use the cost heading.
- Overhead Nominal Account: Select the group default nominal account for posting overhead costs for the cost heading.
You can amend the Overhead Recovery %, Nominal Account and Overhead Nominal Account default settings for individual resources on the resource record.
To delete user defined cost headings, select the cost heading and click Delete.

Note: You cannot delete the standard cost headings.
Click Save.