A bill of materials that becomes a cost sheet
Production is a stock journal with opinions: so much raw material out, so much finished goods in, and the difference is cost and wastage. tBiz records all three, so the cost of a finished unit is a fact from the ledger rather than an estimate from a spreadsheet.
| Component | Qty | Rate | Cost |
|---|---|---|---|
| MS Angle 50×50×6 | 14.20 kg | 54.20 | 769.64 |
| MS Flat 40×6 | 3.80 kg | 51.80 | 196.84 |
| Welding rod 3.15mm | 0.35 pkt | 640.00 | 224.00 |
| Primer coat | 0.40 ltr | 185.00 | 74.00 |
What you get
Multi-level bills of material
A sub-assembly is an item with its own BOM. Costs roll up through the levels rather than being flattened into one long list.
Production that posts
A production voucher consumes the components and receives the finished goods in one balanced movement, at the cost the components actually carried.
Wastage as a real number
Normal and abnormal wastage are recorded separately, because one belongs in the cost of the product and the other belongs in the profit and loss.
Job work out and back
Goods sent to a job worker stay yours and stay on your books, tracked against the challan, with what came back reconciled against what went out.
Work in progress
Material issued to the floor but not yet converted sits as WIP rather than vanishing between two stock figures.
Cost that updates
When the steel price moves, the next production run costs what it actually cost. Old runs keep their own cost, which is what makes a margin comparison meaningful.
How it works
- Define the bill of materials. Components, quantities per unit, expected wastage and any sub-assemblies.
- Raise a production order. How many to make. tBiz shows what components that needs and what you are short of.
- Post the production. Components are consumed from the chosen warehouse, finished goods are received, and the cost per unit is computed from what was actually used.
- Read the cost sheet. Per run or per unit, with material, labour and overhead separated and traceable to the vouchers behind them.
Manufacturing questions
Does tBiz handle job work?
Yes. Goods sent out on a job work challan stay on your books as your stock at the job worker, and what comes back is reconciled against what went out — including the wastage the job worker is allowed.
Can a bill of materials have sub-assemblies?
Yes, to as many levels as you need. Each sub-assembly is an item with its own BOM and its own cost, and the costs roll up so the finished item shows what it really cost to build.
How is wastage treated?
Normal wastage — the amount the process inherently loses — is absorbed into the cost of the finished goods. Abnormal wastage is written off to the profit and loss, because it is a loss and not a cost of production.
Do I need the manufacturing module if I only assemble?
Usually yes, and it is simpler than it sounds: assembly is a one-level BOM. The value is that the assembled item carries a real cost instead of a guessed one.
Related
Cost a product properly
Set up one bill of materials on the free plan and see what your finished unit actually costs.