For partial relief costing method of Item Last, Item Project Last, Item Standard, and Item Project Standard, relief costs will be at face value from ITEM_CST or ITEM_PROJ_CST tables.
For Estimate to Complete (ETC) percentage calculations, below is an example:
If the manufacturing order (MO) build quantity = 10 with non-backflush and backflush components, and a relief is done using different relief quantities and ETC percentages, the scenario is as follows:
|
Non-backflush Component |
Backflush Component |
|
|
Required quantity |
20 |
20 |
|
Required quantity per relief quantity |
NA |
20/10=2 |
|
Unit cost |
5 |
10 |
|
Issued quantity |
10 |
NA |
|
Issued cost |
10 x 5=50 |
NA |
|
Issued cost multiplied by issued quantity |
NA |
10 x Issued quantity |
If sufficient backflush quantity exists, then Issued cost = 10 x 2 = 20 (if relief quantity = 1), 10 x 4 = 40 (if relief quantity = 2), and so on.
If sufficient backflush quantity does not exist, only the available quantity is issued, and issued cost is based on the issued quantity.
If ETC = 100%, it means that you are estimating that the remaining nine (9) unrelieved quantities are 100% complete, meaning the number of completed equivalent units = (9x1) + 1 (this relief) = 10. The unit cost for non-backflush component will then be 50/10 = 5. Using a similar calculation for other ETC%, along with backflush costs added, you get the following examples:
|
Relief Quantity |
Unrelieved Quantity |
ETC% |
Equivalent Units Completed |
Total (Non-backflush + Backflush) Unit Cost |
|
1 |
9 |
100 |
(9 x 1)+1=10 |
(50+20)/10=7 |
|
1 |
9 |
75 |
(9 x 0.75)+1=7.75 |
(50+20)/7.75=9.0323 |
|
1 |
9 |
50 |
(9 x 0.5)+1=5.5 |
(50+20)/5.5=12.7272 |
|
1 |
9 |
25 |
(9 x 0.251)+1=3.259 |
(50+20)/3.25=21.53846 |
|
1 |
9 |
0 |
(9 x 0)+1=1 |
(50+20)/1=70 |
|
2 |
8 |
50 |
(8 x 0.5)+2=6 |
(50+40)/6=15 |
|
2 |
8 |
100 |
(8 x 1)+2=10 |
(50+40)/10=9 |