Rolling Up Product Structure Costs

Use Product Structure Cost Roll-Up (13.12.13) to update the costs of parent items based on the costs of their lower-level components. Each manufactured item has a standard product structure, formula, and/or co‑product/by-product structure associated with it that describes the components or base process required to make the item.

Components have information for the quantity required, expected scrap percentage, and the operation where they are required. Purchased items have material and overhead costs. Manufactured items also have labor, burden, and subcontract costs. Product Structure Cost Roll-Up uses these costs to calculate total cost by item, and lower-level run and setup times.

The system displays a warning if you try to roll up an average current cost set, but allows you to continue. Rolling up average costs interferes with the averaging process. Although you can roll up an average current cost set, consider copying it instead. The system does not let you roll up an average GL cost set.

Note: If you are using cost linking in the Cost Management module, you must roll up costs in a GL cost set that uses the standard costing method. See Effect of Linking on Product Structure Cost Rollups.

You can run a rollup for all items at a site, in one product line or all product lines, by item type or group, or for individual items.

Other important fields in Product Structure Cost Roll-Up are:

The effective date is used to select parent/component relationships to update. Parent/component relationships are defined as effective over a period of time. Effective dates phase in engineering changes and maintain product structure history online. This lets you make changes to a product structure effective in the future, and then evaluate the cost effect of that change.

You can enter a question mark (?) to have the system use the current date. This lets you submit the selection criteria once and then run the same batch whenever a new cost rollup is required. Any time the batch is submitted, the system sets this field to the date the batch is run.

Set these fields to Yes to include lower-level costs in the cost rollup. Total cost includes all this-level and lower-level costs for an item.

Set these fields to Yes to include lower-level run times for manufactured items (not including global or local phantoms) in the cost rollup.

A printed audit trail should normally be requested and filed. The audit trail prints a complete list of all changes made and can be used for reference should problems arise. When set to No, the system rolls up component costs, but does not produce a report of the actions taken.

You can update the costs for all items or only those items with cost changes. Setting this field to Changed Only provides a better audit trail of dates when costs change.

Yield percentages from Routing Maintenance (14.13.1) can be used to calculate component costs. If set to Yes, component costs are adjusted to account for any yield percentage. This adjustment can be upwards (yield is greater than 100%) or downwards (yield is less than 100%).

Since you can use Product Structure Cost Roll-Up with simulated cost sets, you can set the options to provide only the output you require. See Cost Simulation.

Example: You may want to determine the impact of changes in material cost only. Set the fields for other cost set categories to No so that the rollup only considers material cost changes.

Ideally, you run a rollup only when you know that material, labor, burden, overhead, or subcontract costs have changed. However, this is often difficult to determine. Consider running global rollups periodically for the current cost set to ensure that the top-level item costs are truly current. This is especially important if you have selected the average cost or last cost options in Inventory Accounting Control (36.9.2) or in Cost Set Maintenance (30.1) in the Cost Management module.