Overhead Charges
Move Based Overhead Charging
Work in Process automatically charges appropriate overhead costs as you move assemblies through the shop floor. You can charge overheads directly based on move transactions or based on resource charges. For overheads charged based on move transactions with a basis of Item, Work in Process automatically charges overheads upon completion of each assembly in the operation. Work in Process automatically reverse these charges during a backward move transaction.
For overheads based on move transactions with a basis of Lot, Work in Process automatically charges overheads upon completion of the first assembly in the operation. Work in Process automatically reverses these charges during a backward move transaction if it results in zero net assemblies completed in the operation.
Resource Based Overhead Charging
Work in Process automatically charges appropriate overhead costs as you charge resources. You can charge overheads based on resource units or value. Work in Process automatically reverses overhead charges when you reverse the underlying resource charge.
Costing Overhead Charges
Overhead charges increase work in process valuation. The accounting entries for overhead charges are:
| WIP accounting class overhead account
| XX
|
|
| Overhead absorption account
|
| XX
|
You can reverse overhead charges by entering negative Manual resource charges or performing backward moves for WIP Move resources. The accounting entries for reverse overhead charges are:
| Overhead absorption account
| XX
|
|
| WIP accounting class overhead account
|
| XX
|
See Also
Overview of Shop Floor Control
