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Former Member
May 29, 2008 at 01:07 PM

Costing for a special scenario

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Hi,

The client is producing plywood and the major component for this is Veneer. Veneer is a SFG which is produced from logs. The dimensions for the Veneer determines the material codes of the output. The customer does not know when the log is cut what is the dimension of the veneer that will be obtained. As the cost of logs fluctuates and so does the quantity used in the production of veneer, the customer wants to use price control V for veneer so that product costing of the final product is more reliable.

Does anyone have a standard process for the following scenario?

A process order has to be created and logs (raw material) issued to this order at moving average price. Goods receipt is to be done against the order for different veneer materials depending on the output (dimensions) that is obtained. When settlement of the order the variance has to be settled to the different veneers based on a set ratio.

Is there any other method?

Any help would be deeply appreciated by points.

Thanks and Regards

Shivram.