Material and Labor Cost Calculation
The cost of raw material or components issued to work orders or repetitive orders is the lower-level cost of the product and is calculated as WAVG and FIFO.
The weighted average calculation considers this period and the previous period. These calculations are for material, labor, and burden costs.
Several elements can be attached to material costs to capture such things as freight, insurance, and other logistics costs. This is not available in existing direct average costing functionality. In standard QAD EE costing, several elements can be attached to any of the cost categories; in period costing, only material costs can have multiple elements.
The material cost calculation is as follows:
(this period material cost * this period receipt quantity + last period material cost * last period item quantity balance + this period material cost adjustment) / (this period receipt quantity + last period item quantity balance)
The unit labor cost calculation is as follows:
Unit labor cost = the unit setup labor cost + the unit run labor cost
Labor cost calculation applies to semi-finished components:
(this period labor cost * this period receipt quantity + last period labor cost * last period item quantity balance + this period labor cost adjustment) / (this period receipt quantity + last period item quantity balance)
Burden cost calculation applies to semi-finished components:
(this period burden cost * this period receipt quantity + last period burden cost * last period item quantity balance + this period burden cost adjustment) / (this period receipt quantity + last period item quantity balance)