Sage Pastel • Overview of Additional Costs on Bills of Materials

Additional Costs on Bills of Materials

These are extra costs that you incur over and above the normal costs of manufacturing a bill of materials. These include overhead costs such as indirect labour, freight, electricity and so on. Pastel offers two ways of adding such item costs to bills of materials:

Normal Method

You can set up to three additional cost items. You specify the cost item’s description and a general ledger account into which to debit (charge) that item’s cost. You do this in the Setup…Inventory menu option, in the Bills of Materials tab.

When creating a bill of materials, you enter the cost value of each item in the Edit…Manufacturing…Bills of Materials menu option, in the Components tab. Pastel maintains these cost item descriptions on each bill of materials that you create.

Note that if your inventory is not integrated into the general ledger, you only set up the descriptions. You do not enter recovery accounts. You still enter the value of each cost item on the bill of materials.

Alternative Method

You create each additional cost item as a service inventory item. You MUST also enter its cost value in the item’s master file Last Unit Cost field. When the cost value changes, you need to go to the same field to edit the cost price. You do all this in the Edit…Inventory…Item File menu option.

When creating a bill of materials, you enter each additional cost item (service item) like any normal component item on the bill of materials. You can enter as many additional costs on a bill of materials as you need.

One significant difference between these methods is that if you use the normal method you can enter different values on each bill of materials.