Hi all,
I got a particular scenario of production for which I need all your assistance.
An item, say X, a batch item, a raw material which we purchase and produce different types of Finished Goods say A, B, and C, these are all batch items. We put X in a machine which gives us Y, also a batch item. Putting different quantity of Y, through some other machines we produce A, B and C.
We Purchased 100 unit of Item X at $ 2
Shihft1
BOM1
U machine
Produced: Y, Qty:80, $/unit: ?, Total Value: ?
Consumed: X , Qty:100, $/unit: 2, Total Value: $ 200
BOM2
FG1 Machines
Produced: A, Qty:10, $/unit: ?, Total Value:?, Direct Labour: $50
Consumed: Y, Qty:80, $/unit: ?, Total Value: ?
BOM2
FG2 Machines
Produced: B, Qty:20, $/unit: ?, Total Value:?, Direct Labour:$ 20
Consumed: Y, Qty:80, $/unit: ?, Total Value: ?
BOM2
FG3 Machines
Produced: C, Qty:30, $/unit: ?, Total Value:?, Direct Labour:$ 30
Consumed: Y, Qty:80, $/unit: ?, Total Value: ?
Please note that while putting item Y through machines FG 1, 2 and 3, we do not weigh Item Y, as it requires a lot of time. It’s an Operational issue. So we treat Y with 80 Unit through 1 production entry of BOM2 for 1 shift. Machine FG 1, 2 and 3 give us output produced for A, B and C at the end of the shift, which is 10, 20 and 30 respectively. Machine U gives us item Y with produced quantity of 80 unit at the end of the Shift.
Could any one please specify what would be the values in “?” marked places above? And as per scenario would this be correct setup of BOM? If not How would you have the set up. Please response ASAP.
I’m no Production specialist but I think this set up will give us the gross Cost Of Production as because of Operation. Correct me if I’m wrong.
SHAMS .