Configured Item Product Costing

Costing for configured items is different from costing for non-configured items because configured items do not have a standard bill of material or routing. Because no standard configuration exists, costing cannot be established before you enter an order. The discrete standard cost roll-up concept does not apply to a configured item, so the Cost Simulation – Build Temp program (R30812) is never executed and no frozen standard costs exist in the Item Cost Component Add-Ons table (F30026).

However, standard costs for purchased parts and manufactured parts that are used by configured items must be established and frozen (07 Cost Method) in the Item Cost File table (F4105) to be factored into the calculated costs for configured item work orders.

The Order Processing (R31410) program performs a cost rollup when it attaches a parts list and routing to a work order for a configured item. A processing option instructs the program to calculate the costs. The costs are stored in the Column 1 - Frozen Standard field in the Production Cost table (F3102), not table F30026.

The costs are the accumulation of the standard costs for the components, the labor and overhead values that are defined in manufacturing constants, the attached routing and work center information, and work order values.

For a configured item, the A1 material cost is calculated from the total cost of its direct components. The components are defined by the P and Q assembly inclusion rules.

B1 direct labor cost is calculated from the item's routing, which is defined by the R assembly inclusion rule.

Cost defined by the X assembly inclusion rules affects only the sales order and not the work order. Thus, associated X assembly inclusion rule costs are not shown in table F3102.

Note: If you use cost method 02 (Weighted Average) or cost method 09 (Actual, Manufacturing), processes and configured items are not supported. The content in this topic does not apply.

After Order Processing establishes the standard costs for the configured items, journal entries for configured items are created in the same way as for nonconfigured items.

Sales quotes for configured items are an exception to the standard costing rule for configured items. The standard cost for a configured item on a sales quote is calculated without running Order Processing if the Cost Sales Quote functionality is selected in Configurator Constants (P3209).

This table indicates the source of cost generation in table F3102 for configured items:

Costing Method	Standard	Current	Planned	Actual	Completed	Scrapped	Unaccounted Completed	Unaccounted Scrapped
Standard Costing	R31410	Not used	R31802A	R31802A	R31802A	R31802A	Not used	Not used