Discrete Jobs End to End Cycle with Cost Roll-up in

Standard Cost Organization in R12.2

STEP 1: CREATE ITEMS

Responsibility: Inventory Navigation: Items > Master Items
Select the Organization as "M1 - Seattle Manufacturing"
Create the below items;

Item Item Template (Type)

DYS_CAR Finished Goods
DYS_ENGIN
E Purchased Item
DYS_CHASIS Purchased Item
DYS_WHEEL Purchased Item
DYS_SEAT Purchased Item

Item : DYS_CAR Template/Type: Finished Goods

Item : DYS_ENGINE Template/Type: Purchased Item
Item : DYS_CHASIS Template/Type: Purchased Item
Item : DYS_WHEEL Template/Type: Purchased Item
Item : DYS_SEAT Template/Type: Purchased Item
STEP 2: DEFINE ITEM COST
Define the Item Costs like below;

Item Item Template (Type) Item Cost (USD)

DYS_CAR Finished Goods
DYS_ENGIN
E Purchased Item 500
DYS_CHASIS Purchased Item 300
DYS_WHEEL Purchased Item 100
DYS_SEAT Purchased Item 50

Responsibility: Inventory Navigation: Costs > Item Costs

Click on "New"
Item: DYS_ENGINE Cost Type: Pending

Click on "Open"
Click on "Costs"
Cost Element / Sub-Element: Material Unit Cost: 500 USD
Save

Query the Item "DYS_ENGINE"

Can see two records for this item. One record will be in "Frozen" Cost Type and the another
one will be in "Pending" Cost Type. Currently "Frozen" cost type will show only zero (0) cost.
Once we run the "Update Standard Costs" then the cost will be updated in Frozen type
from Pending cost.
Note: M1 - "Seattle Manufacturing" is a Standard Costing Organization. So, we need to enter
the cost in "Pending" cost type.
Likewise we can enter the Item Cost for remaining items
Item: DYS_CHASIS Unit Cost: 300 USD
Item: DYS_WHEEL Unit Cost: 100 USD
Item: DYS_SEAT Unit Cost: 50 USD
STEP 3: DEFINE RESOURCES
Define the Resources like below;

Resources Name Resource Type Rate UOM

DYS_ASMLY Machine 100 HR
DYS_LBR Person 50 HR
DYS_PNTR Person 25 HR

Responsibility: Bills Of Material Navigation: Routing > Resources

Select the Organization as "M1 - Seattle Manufacturing"
Enter the Resource Name, Resource Type, Charge Type and enable the "Costed" &
"Standard Rate" check box and enter the Absorption Account and Variance Account.
Click on "Rates"

Likewise create the remaining Resources and enter the Resource Rates.
Resource Name: DYS_LBR Type: Person Rate: 50 USD
Resource Name: DYS_PNTR Type: Person Rate: 25 USD
STEP 4: DEFINE DEPARTMENTS
Create the new Departments and assign the Resources to each Departments like below;

Department Name Resources

DYS_ASMLY
DYS_ASMLY DYS_LBR
DYS_PAINT DYS_PNTR

Responsibility: Bills Of Material Navigation: Routing > Departments

Select the Organization as "M1 - Seattle Manufacturing"
Click on "Resources"

Create the another department for Painting and assign the resource.
Department Name: DYS_PAINT Resources: DYS_PNTR

Click on "Resources" and assign the Resource

Note: For this case, only Machine Resource (DYS_ASMLY) is available for 24 Hours. Person
Resources (DYS_LBR and DYD_PNTR) are available only in normal day shift.
STEP 5: CREATE STANDARD OPERATIONS
Create the Standard Operations and assign the Departments like below;

Standard Operations Department Resources Usage

DYS_ASML
1
Y
2
DYSA DYS_ASMLY DYS_LBR
DYSP DYS_PAINT DYS_PNTR 1

Responsibility: Bills Of Material Navigation: Routing > Standard Operations

Operation Code: DYSA Department: DYS_ASMLY
Click on "Operation Resources" and assign the Resources and it's "Usage/Inverse"

Note:
1. "DYS_ASMLY" Machine Resource will produce 1 Unit in 1 Hour (UOM = HR)
2. "DYS_LBR" Person resource will produce only half (0.5) unit in 1 hour. That means, 2
resources are required to complete this operation in 1 hour. So, the Inverse (Output/Hour)
becomes 0.5
Likewise create one more Standard Operation and assign the Department and it's
Resources.
Operation Code: DYSP Department: DYS_PNTR Resource: DYS_PNTR Usage: 1

Click on "Operation Resources" and enter the Usage

Note: Painter Resource will paint 1 Unit in 1 Hour

STEP 6: DEFINE OVERHEADS

Define one Overhead and enter the Rate/Unit
Responsibility: Inventory Navigation: Setup > Costs > Sub-Elements > Overheads
Overhead Name: DYS_OVRHED Cost Element: Overhead
Click on "Resources" and enter the Cost Type and then assign the Resources
Cost Type: Pending Resource: DYS_ASMLY

Save and Close the "Resource" Form

Click on "Rates" button and enter the Amount  
Basis: Item
Now, close the form and navigate to "Resources" form in Bills Of Materials
Note:
1. If we define Overheads based on "Basis = Item" then, the Formula is
Overhead Cost Calculation = Overhead Rate or Amount
2. If we define the Overheads based on "Basis = Resource Basis" then the formula is
Resource Overhead Cost = Resource Usage  X   Resource Cost  X  Overhead Cost

Responsibility: Bills Of Materials Navigation: Routing > Resources

Query the Resource " DYS_ASMLY" (This resource was attached in Overheads)
Click on "Overheads" button
Now, we can see the Overhead "DYS_OVRHED" which was created in the pervious step has
been assigned here.
STEP 7: DEFINE ROUTING
Create the Routing for our Finished Goods "DYS_CAR"
Se
Operation Code Department Resources Usage Inverse
q
DYS_ASML
1 1
Y
2 0.5
10 DYSA DYS_ASMLY DYS_LBR

1 1
20 DYSP DYS_PNTR DYS_PNTR

Responsibility: Bills of Materials Navigation: Routings > Routings

Click on "Operation Resources" and make sure all the assigned Resources are displaying or
not for that Operation Seq.

STEP 8: DEFINE BILLS

Define the Bills of Materials for "DYS_CAR"  to produce 1 Unit

Bills Components Required Qty

DYS_CA
1
R DYS_CHASIS
DYS_CA
1
R DYS_ENGINE
DYS_CA
5
R DYS_WHEEL
DYS_CA
3
R DYS_SEAT

Responsibility: Bills Of Materials Navigation: Bills > Bills

Save

STEP 9: UPDATE STANDARD COST

Responsibility: Inventory Navigation: Costs > Standard Cost Update > Update Cost
Select "M1" Organization

" Update Standard Costs" program will be submitted and Running

Now, query the Item Costs for all our items
Navigation: Costs > Item Costs
Note:
1. When we run the "Update Standard Costs" program for "Pending" Cost Type, it will
pull the Pending costs and push it into "Frozen" cost type.  
2. "DYS_CAR" doesn't reflect any cost. Because, the Cost Roll-up has not happened.

STEP 10: COST ROLL-UP

Responsibility: Cost Management
Navigation: Supply Chain Costing > Supply Chain Cost Rollup
Select the Organization as "M1 - Seattle Manufacturing"
Submit a single request and submit " Supply Chain Cost Rollup - Print Report"
Enter the parameters like below
Parameters:
Ran this report for "Pending" Cost Type for Specific Item "DYS_CAR"

View Output of "Supply Chain Cost Rollup - Print Report":

Material Cost Calculation:
Qt
Components Item Cost Total Cost
y
DYS_CHASIS 1 300 300
DYS_ENGINE 1 500 500
DYS_WHEEL 5 100 500
DYS_SEAT 3 50 150
MATERIAL COST 1450

Resource Cost Calculation:

 Resources
Resource Type Rate UOM Usage Cost
Name
DYS_ASMLY Machine 100 HR 1 100
DYS_LBR Person 50 HR 2 100
DYS_PNTR Person 25 HR 1 25
Total Resource Cost 225

Overhead Cost Calculation:

Resource
Overheads Department Rate or Amount
Name
DYS_ASMLY DYS_OVRHED DYS_ASML 10

Total Cost Calculation:

Cost Element Value

Total Material Cost 1450
Total Material Overhead Cost 0
Total Resource Cost 225
Total Overhead Cost 10
Total Outside Processing Cost 0
Total Cost 1685

Add Additional Resource Overhead Cost based on Resource Usage:

Responsibility: Bills Of Materials Navigation: Routings > Resources

Query the Resource "DYS_LBR"

Add something existing overheads by clicking "Overheads" button
Added "Indirect" Overheads under "Pending" Cost Type.
Assign Overheads to Department/Resources:
Responsibility: Inventory Navigation: Setup > Costs > Sub-Elements > Overheads
Query the "Indirect" overhead

Click on "Resources"
Select "Pending" Cost Type and check our Resource "DYS_LBR"

Our Resource is available.

Close this form
Click on "Rates"
Select "Pending" Cost Type and add our Department "DYS_ASMLY"
Basis: Resource Value

Note:
Previously we have defined one Overhead "DYS_OVRHED" that is based on the "Basis =
Item". Now, we have defined one Overhead based on "Basis = Resource Value". The
Overhead Cost Calculation will be different in both the cases.
For Item Basis, cost is direct. Whatever the Rates we have entered in Overheads form that is
a Cost
For Resource Basis, cost calculation is based on the below formula.
Resource Overhead Cost Calculation = Resource Usage  X   Resource Cost  X  Overhead Cost

STEP 11: UPDATE STANDARD COST

Repeat the step 10
Responsibility: Cost Management
Navigation: Item Costs > Standard Cost Update > Update Costs

Run "Update Standard Costs " program for specific item "DYS_CAR"
Submit the program
Once it's completed, do Cost Roll-up for this Item
STEP 12: COST ROLL-UP:
Navigation: Supply Chain Costing > Supply Chain Cost Rollup
Run "Supply Chain Cost Rollup - Print Report" program
Submit and View Output for "Supply Chain Cost Rollup - Print Report"
There are no changes in the Material and Resource Costs. But, there are some changes in
the Overheads.
Overhead Cost for "DYS_OVRHED" = 10 USD
Overhead Cost for "Indirect" = Resource Usage  X   Resource Cost  X  Overhead Cost
Indirect Overhead Cost = 2 X 50 X 15 = 1500 USD
Total Overhead Cost = 10 USD + 1500 USD = 1510 USD

STEP 13: INCREASE ONHAND QTY FOR COMPONENTS

Do Miscellaneous Receipts or PO Receipts for Purchased Items

Save and Close the form

STEP 14: CREATE DISCRETE JOBS
Responsibility: Work In Process Navigation: Discrete > Discrete Jobs
Create a New Discrete Job for Assembly "DYS_CAR" and Save
STEP 15: RELEASE DISCRETE JOBS
Responsibility: Work In Process Navigation: Discrete > Discrete Jobs
Query the Discrete Job# 262860 that was created in the previous step
STEP 16: WIP ISSUE
Sine this Assembly's Supply Type is "Assembly Pull", it doesn't require to perform WIP Issue.
System automatically issue the components upon completion of this Assembly
STEP 17: MOVE TRANSACTIONS
Responsibility: Work In Process Navigation: Move Transactions > Move Transactions
Query the JOb# 262860 and Move the Materials from Operation Seq 10 "Queue" to
Operation Seq 10 "To Move"
Move the Materials from Operation Seq 10 "To Move" to Operation Seq 20 "To Move"
Save

STEP 18: ENTER QUALITY RESULTS_

If you have enabled Quality Collection Plan then enter those Quality Results

Click "OK"
To enter the Quality Results;

Navigation: Tools > Enter Quality Results or click on button from Menu bar
Enter the Quality Results

Click OK and Save

STEP 19: WIP COMPLETION
Responsibility: Work In Process Navigation: Material Transaction > Completion
Transactions
Enter the Discrete Job number# 262860 and select the Transaction Type as "WIP
Completion"

Click "Continue"
Sub-Inventory: FGI Qty: 10
Click "Done"

STEP 20: CLOSE DISCRETE JOBS

Responsibility: Work In Process
Navigation: Discrete > Close Discrete Jobs > Close Discrete Jobs (Forms)
Query the Discrete Jobs# 262860 which we have completed recently
Before closing the Discrete Jobs, check the Pending Transactions. To check the Pending
Transactions
Navigation: Tools > Pending Actions
Select the "Pending Actions" option from Tools Menu and check for any pending actions

Only "Material Transactions" and "Resource Transactions" are enabled.

If anything other than the below mentioned actions are enabled then that means there are
some pending actions
1. Material Transactions
2. Resource Transactions
3. PO Requisitions
In our Discrete Jobs, there are no pending actions. So, it's eligible to Close

To Close the Discrete Jobs, Navigate to Tools Menu and select the Close option
Select "Summary" and click "OK"

Discrete Job Status = Pending Close

Navigation: Tools > View > Request

Can see two requests

1. Close Discrete Jobs
2. Discrete Job Value Report - Standard Costing
If there are any pending actions then the second request will not run
Select the second request "Discrete Job Value Report - Standard Costing" and check the
output
View Output:
Costing:
Material Cost: 1450 USD/Unit X 10 Qty = 14,500 USD
Resource Cost: 225 USD/Unit X 10 Qty = 2,250 USD
Overhead Cost: 10 USD + 1500 USD = 1510 USD/Unit X 10 Qty = 15,100 USD
Total Cost for 1 Qty = 1450 + 225 + 1510 = 3,185 USD
Total Cost for 10 Qty = 14,500 + 2,250 + 15,100 = 31,850 USD