Inventory - Overhead added at each assembly stage

[Former Member]

hi Guru,

: Inventory - Overhead added at each assembly stage

I have had a look into the BOM for the product code #####-######. At each assembly stage of the product overhead is added on. This is grossing up each time, meaning that the BOM and cost in stock is too high.

Would it be possible to amend this?

A sub assembly of materials and labor+ overheads, rolling to a material cost in a higher sub assembly or a manufactured part, and the overhead / labor being surcharged on the whole.

This is causing a snowballing effect. It seems that the part number he refers to has no stock so I think the effect should be nothing as of now, but we need to fix this

[Former Member · Accepted solution]

the problem is you have overhead under the each material ,labor and setup of the BOM

In product costing when you do the routing for the BOM please remove the overhead and at aty the time of finished good.

so that as meny time the BOM passes through each work centres the overhead cost should not keep piling on the material

which further increases the cost

I hope this would resolve the issue

[Former Member]

hi

to remove the overhead at the semi finished good level would not be possible so the best way is to reduce the overhead percentage rate. the same percentage would be calculated at the time of finished good level as well. this

should resolve the issue.