Understanding Production Actual Cost Transactions
Production actual cost transactions account for the actual cost of production when the make item uses an actual or average cost method. Actual production costs include the actual cost of materials, conversion costs, conversion overhead costs, subcontracted components, and additional costs. The transaction groups that are used to record production actual costs are:
| Transaction Group | Description | Transaction Process | Menu Path |
|---|---|---|---|
|
601 |
Wt Avg Upd Production Var. |
Run the Transaction Costing process for a production ID or production schedule that is closed for accounting. If the make (end) item is average costed, then this transaction group accounts for average cost updates due to new cost information on receipts from manufacturing, usually when the estimated manufacturing cost from partial receipts from work in process are updated to a finalized manufacturing cost once the production order or production schedule is complete. |
Cost Accounting, Inventory and Mfg Accounting, Created Accounting Entries, Inventory Transaction Costing, Transaction Costing |
|
605 |
Wt Avg Upd Prod Writeoffs. |
Run the Transaction Costing process for a production ID or production schedule that is closed for accounting. If the make (end) item is average costed, then this transaction group creates a writeoff when the average cost of the item needs to be updated, due to new cost information on receipts from manufacturing, but there is not enough quantity currently in stock to absorb the updated costs. |
Cost Accounting, Inventory and Mfg Accounting, Created Accounting Entries, Inventory Transaction Costing, Transaction Costing |
|
606 |
Avg Rev Compl Write-off |
Run the Transaction Costing process for a production ID or production schedule that is closed for accounting. If the make (end) item uses the perpetual weighted average method, then this transaction group creates a writeoff, when needed, to clear the production costs from WIP. |
Cost Accounting, Inventory and Mfg Accounting, Created Accounting Entries, Inventory Transaction Costing, Transaction Costing |
|
622 |
Actual Waste Cost. |
Run the Transaction Costing process for a production ID or production schedule that is closed for accounting. If the make (end) item is actual or average costed and a waste by-product is produced, then this transaction group credits an expense account and debits the finished goods inventory account. |
Cost Accounting, Inventory and Mfg Accounting, Created Accounting Entries, Inventory Transaction Costing, Transaction Costing |
|
630 |
Overhead |
Run the Transaction Costing process for a production ID or production schedule that has been closed for accounting. If the make (end) item is actual or average costed, then this transaction group debits WIP and credits a manufacturing overhead cost absorption account for overhead costs of the production. These costs are applied using material, labor, and machine amounts as the basis for allocating overhead charges to production outputs. |
Cost Accounting, Inventory and Mfg Accounting, Created Accounting Entries, Inventory Transaction Costing, Transaction Costing |
|
640 |
Actual Labor Costs. |
Run the Transaction Costing process for a production ID or production schedule that has been closed for accounting. If the make (end) item is actual or average costed and the operation sequence is complete, then this transaction group credits earned labor account and debits WIP with the actual labor costs. |
Cost Accounting, Inventory and Mfg Accounting, Created Accounting Entries, Inventory Transaction Costing, Transaction Costing |
|
645 |
Actual Machine Costs. |
Run the Transaction Costing process for a production ID or production schedule that is closed for accounting. If the make (end) item is actual or average costed and the operation sequence is complete, then this transaction group credits earned machine account and debits WIP with the actual machine costs. |
Cost Accounting, Inventory and Mfg Accounting, Created Accounting Entries, Inventory Transaction Costing, Transaction Costing |
|
651 |
Production Cost Writeoff. |
Run the Transaction Costing process for a production ID or production schedule that is closed for accounting. This transaction group is used when there is an overriding adjustment and additional costs hit WIP. This transaction group writes off those WIP costs which do not belong in finished goods. |
Cost Accounting, Inventory and Mfg Accounting, Created Accounting Entries, Inventory Transaction Costing, Transaction Costing |
|
661 |
Actual Cost Variances |
Run the Transaction Costing process for a production ID or production schedule that is closed for accounting. If the make (end) item is standard costed and one or more of the components uses actual or average cost, then this transaction group relieves WIP for the difference between the actual cost of the component consumption transaction and the standard cost of the component which was used to build up the standard cost of the end item. The offset is posted to a period variances ChartField. Although the inputs to standard cost end items can have standard costs themselves, the input items can still use any cost profile for accounting purposes. As components are depleted, the cost on the depletion becomes part of the actual cost of the output items. |
Cost Accounting, Inventory and Mfg Accounting, Created Accounting Entries, Inventory Transaction Costing, Transaction Costing |
|
664 |
Subcontracted Cost. |
Run the Transaction Costing process for a production ID or production schedule that is closed for accounting. This transaction group records the variance between subcontracted costs on the purchase order and the actual subcontracted costs on the voucher. This transaction group is used only for actual or average cost items. |
Cost Accounting, Inventory and Mfg Accounting, Created Accounting Entries, Inventory Transaction Costing, Transaction Costing |