Exercise 1: Setting Up Co/By-Product Costing
In this exercise you will create a base process and add to it components, co-products and by-products. You will then roll up the costs and review various cost reports. You will use several components already in the database, but will also be creating new items and modifying others. In order to avoid conflict with other processes we will do this exercise in site 10-100.
1 Review Inventory Accounting Control (36.9.2); note the Current Cost is set to update with Average costs. You will be working with a general ledger cost set that is Standard.
2 Your base process is taken from the course material. Base Process B-70000 makes fruit juice from four components:
• Fruit: item 80050
• Spices: item 80051
• Water: item 80052
• Preservative: item 80053
There are 7 operations in the process that yield:
• Two co-products: fruit juice (item 70040) and fruit pulp (item 70041)
• Two by-products: fruit seeds (item 70042) and fruit peel (item 70043)
You bottle the juice, sell the pulp to a jam factory, and compost the seeds and peel.
3 Use Item Master Maintenance (1.4.1) to create base process B-70000.
a Specify unit of measure L.
b You can enter any description, but it will make juice.
c Assign it to product line 30 and site 10‑100.
d In planning data, set its Order Quantity to 5,000 and the Purchase/Manufacture code to M.
That is all the data needed for a base process.
4 Use Item Master Maintenance (1.4.1) for item 80050:
a Change the Unit of Measure to KG.
b Delete the L in Lot/Serial Control.
c Change the Site to 10-100.
d Clear the Location Type COOL.
e Clear the shelf life and uncheck the Key Item box.
The other data is ok.
5 Modify some current items. The items you want to use are currently set up at site 10-400 and have lot control. You will set them up at site 10-100 without lot control. Use Item-Site Data Maintenance (1.4.5) for the following items: 70040, 80051, 80052, 80053.
In each case set the site code to 10-100; clear the L from the Lot/Serial field and let the location default. Clear shelf life and Key Item if present.
6 Add three new items: 70041 Fruit Pulp, 70042 Fruit Seeds, and 70043 Fruit Peel.
Use Item Master Copy (1.4.12) and copy item 80050 to 70041, 70042, and 70043. Change the item code and description; all other data is the same.
7 These items have no cost data at site 10-100.
Use Item-Site Cost Maintenance (1.4.18) to add costs to the GL Standard cost set for the components and by-products.
|
Item
|
GL Material Cost
|
|
80050
|
5.00
|
|
80051
|
1.00
|
|
80052
|
1.00
|
|
80053
|
1.00
|
|
70042
|
0.50
|
|
70043
|
0.50
|
8 Use Cost Roll-Up Freeze/Unfreeze to freeze the costs of the by-products 70042 and 70043 at site 10-100 and for the Standard Cost Set.