Manufacturing Costing : Single Input Multiple Output

ssingla

Has anybody implemented the following scenario or can Navision manage it :

Company uses single product as Raw Material and produces multiple products + scrap. The consumption-output ratio is 1:1 i.e. 1 kg of Raw material will produce 1 kg of output irrespective of the item (either main product, by product or scrap).

Client is using manufacturing module and there is single operation with practically no WIP.

My initial view is that Navision wont do it and I would be happy to get contradictory remarks/suggestions.

muksha

Yes it is possible, many clients are following it. But can you explain me why do you wanted to ristrict the output equals to 1:1 ratio. You mean no scrap in that case and contradictorily you are asking for the scrap too.

ssingla

The scrap is also defined as a item and is transacted like normal item, the only difference is the value.
My question is how Navision will distribute the cost on main product and scrap. Costing principle says that the cost of the scrap should be based on the realizable value of the scrap and not on the cost of input. The difference portion of the cost should be loaded on the main products.

muksha

You are saying that:-
Costing principle says that the cost of the scrap should be based on the realizable value of the scrap and not on the cost of input. The difference portion of the cost should be loaded on the main products.

You are right, please put the cost of scrap (realisable value should be considered as constant- it is not changes on daily basis) as the unit cost on the scrap item card. You also have to follow the principle of costiing that unit cost of output item should go to the cogs and we should have some value of scrap to find out the cost of output to be transfered to cogs.

So askd your client to freeze the cost of scrap first, than only you will be able to get the correct costing.

ssingla

If somehow I am able to populate the values in the output journal as required , my worry is this that the adjust cost batch job will replace the values. ](*,)

muksha

Please don't do that, as this will also be updated when you will run the update unit cost. We have to understand the system's current scenerio that what is it doing and why? If you want to do this you have to bypass it's current functions and completely write your code as per the requirement. Logic should be developed, if you can develop the logic than you will be able to do that.
Presently cost of the output is your variable and cost of the byproduct should be constant, than only you will get the correct costing.