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Evo-ERP and DBA Classic >> Manufacturing >> WIP Variance nightmares
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Message started by Kelloggs on 04/08/04 at 05:58:23

Title: WIP Variance nightmares
Post by Kelloggs on 04/08/04 at 05:58:23

Hi,

On our Work in Process Summary Report, we have negative or positive X amount of dollars each month (including Closed WO).

Where is this amount posted? .To the Inventory Variance Account?

Does it mean that on our financial statements we are increasing/decreasing our profit? Is this amount posted to the Wip Variance Expense or the Wip - Closing Account?

I dont have any accounting background, so bear with me. These variances amounts are keeping me awake and giving me bad nightmares :'(

Thank you All,

Kelloggs

Title: Re: WIP Variance nightmares
Post by lmk223a on 04/09/04 at 09:59:57

:D If you are looking at JC_M Work in Process Summary report, the NET WIP (last column) represents the $ value difference between the value at which the completed units went into finished goods (i.e. std cost) and the work order total actual costs. This remaining value represents the company's investment of the uncompleted units, work in process. This number is not posted to the GL nor does it appear on the financial statements.

Only when a work order is closed, does the WIP variance post to the general ledger (i.e. financial statements) . It represents the difference between the work order actual incurred costs and the costs that were transferred to finished production for all units on the work order. Specfically to which account it posts, depends on what account is set up in the default WIP variance (this default is set up in the Accounting module, AD-A, General Ledger Defaults, and click on the bottom left button that reads Manufacturing GL accounts)

Hope this helps.