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Evo-ERP and DBA Classic >> Items >> Tracking ALL materials - is it reasonable?
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Message started by JohnBierrie on 01/09/04 at 07:23:44

Title: Tracking ALL materials - is it reasonable?
Post by JohnBierrie on 01/09/04 at 07:23:44

Ok... REALLY DUMB question this time...

Currently, we are using DBA to handle, obviously, all our materials used in manufacturing, and we are ALSO using it to keep track of all the other items the company purchases for general use (beyond mfg). The mfg portion is no particular problem (other than the normal DBA issues), but the office, shop and other areas are.

To "issue" materials to a WO, is standard. How would one "issue" materials to the sales dept., or front office, or.... etc., etc.? We have thought of creating internal wo's that each department is responsible for and on a monthly basis, close the wo's out and move the material costs to their areas, but...?

On a similar note, "engineering" (and we all know engineers are notoriously bad at accounting for material usage) pull materials out of stock for "testing" purposes (and I use that term loosely!), how do others track those expenses?

Please understand, we know it is "easy" enough to transfer dollars from one place to another via normal accounting practices, but DBA, with one of it's strength's being it can track materials, permits us to "standardize" on the paper, penciles, pens, notebooks, file folders, etc., etc. we use. ie., when someone needs a notebook, we know exactly which one to get and it's done. At least it comes in and it is given to them, getting it out of inventory is another matter, or issue, as the case may be! :-)

Thanks

John

Title: Re: Tracking ALL materials - is it reasonable?
Post by aricon on 01/09/04 at 09:15:53

If you really want to track overhead costs and availability that finely, then your only reasonable option is to create WO's with a VERY different numbering sequence from the normal, and issue to those WO's. You would then do manual JE's to move the cost(s) at the end of the month to whatever overhead accounts you want.

If you set-up multi-departmental accounting, this last step would not be neccessary, but it probably isn't worth the hassle to you to do so.

Title: Re: Tracking ALL materials - is it reasonable?
Post by Cyndee Pappas on 01/09/04 at 10:29:55

Type "I" Indirect work orders handle this great. You need a Class for each GL expense account you want to charge (R&D, Office, etc.) Assign that GL number to the WIP Inventory Asset for that Class. Then make a separate type N part number for each type of expense and assign it to that Class. Make an I type work order for that part # with no BOM. Issue parts to it using WO-G as usual. The first time you issue a component, it will say something like "This component is not on the BOM for this parent part. Would you like to add it?" Say yes. Voila! Inventory is relieved and the expense is posted. The work orders can stay open as long as you wish. We close ours periodically, because the components issued show up as being in WIP until the WO is closed. Think millions of screws.

Title: Re: Tracking ALL materials - is it reasonable?
Post by aricon on 01/09/04 at 10:46:10

Cyndee,

Couple of problems I have with your methodology.

1. You indicated that you have this stuff assigned to a WIP Asset account. It is not asset stuff. It is expense stuff.

2. If you use type N numbers, you lose track of the qty on hand and such which I think was something they were looking for.

Title: Re: Tracking ALL materials - is it reasonable?
Post by Lynn_Pantic on 01/09/04 at 11:49:11

Lorne -

The item class for the N part used as the parent for the type I work order is defined with an expense account as "WIP" so anything issued to that work order is immediately expensed, there is no journal entry required. This is especially useful when moving inventory to R&D for prototype, etc. The parent of teh Sustus I WO is a type N but the items being tracked can be R.

Title: Re: Tracking ALL materials - is it reasonable?
Post by aricon on 01/09/04 at 12:10:48

Lynn,

As far as the type N parent, right....just wasn't thinking there.

As far as the G/L account, she clearly stated that she has it pointed to an asset account. Had she said expense account, I wouldn't have said anything. ;)

Title: Re: Tracking ALL materials - is it reasonable?
Post by Cyndee Pappas on 01/09/04 at 13:18:24

Sorry I wasn't clear. I am using an expense account, but the line it goes on under Item Class GL is called WIP Inventory Asset. Sorta implies that it has to be an asset account, but not so. ;)

Title: Re: Tracking ALL materials - is it reasonable?
Post by jeanb on 01/15/04 at 11:41:12

If getting the items out of inventory is a problem, you may want to try (at least for office supplies, ect), making those parts a "N" part and a difference class. I have our office supplies set up under the class "OFF" and when they are received, the expense goes to office supply expense and there is no inventory since it is a "N" part. I also have a separate class for MTNC (Maintenance supplies), FACT (factory supplies), ect and they are all set as N parts so getting them out of inventory never matters, but we still have the info in the system for purchasing on PO's.