| 1. FAQ-General Accounting |
| 1.1. Balance Per Books and Balance Per Bank have discrepancy | Issue:
Balance per Bank and Balance per Books fields have a discrepancy even though the Deposits and Checks all cleared.
Source:
This was more than likely due to a Deposit or Check Correction made within the Bank Reconciliation in prior statements.
Resolution:
If users need to enter in a Deposit or Check Correction through the Bank Reconciliation module for what ever reasons, they then have to remember to go back to process the needed Deposit or Check for the correction amount. (via the AR Bank Deposit or AP Check modules)
ManEx system can not create the correcting transaction through the Bank Reconciliation module because the system will not know what the other side of the Transaction will need to be.
Note: User can also use the General Journal Entry module to process the correction transaction through the system. General Journal Entries also affect the Bank Balance within the ManEx System.
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| 1.2. Can ManEx Value Raw Material based off of the Purchase Price versus Std Cost? |
| Can ManEx Value Raw Material based off of the Purchase Price versus Std Cost? |
Q. Can ManEx Value Raw Material based off of the Purchase Price versus Std Cost?
A. Our system operates on a “Standard Cost Basis” (SCB). This means that the value of inventory does not fluctuate based on the purchase price, and that users do not have to use FIFO (First In, First Out) inventory management for financial reasons. (They may wish to because of other considerations, such as shelf life.) Because of SCB, we necessarily utilize Purchase Price Variance (PPV) to account for the difference between the SCB value and the actual purchase cost. This measure also helps companies set their standard cost, based on a review of the PPV for given components. Once a reasonable standard cost is established, then the Purchasing department has metrics through the PPV reports to determine whether or not they are improving on price negotiations, or are unable to attain the standard cost. Purchasing departments with a positive PPV are contributing to the bottom line of the company. Because of this, Purchasing will tend to navigate standard costs to the higher side of average. With correct Standard Costs, Marketing Department can better control their margins. And Marketing will tend to drive standard costs to the lower side of average, thus improving their margins.
ManEx does not have a direct provision for assessing current inventory based on purchase price. An approximation could be offered by combining the PPV of the last month with the on-hand inventory value. This is an approximation, because there may be old and/or obsolete inventory which was received at a significant PPV, and would not be accurately valued considering only the standard cost.
But there is provision within ManEx to account for inventory based on purchase price. It involves the utilization of the Project module. All inventory in which the company may wish to evaluate based on the purchase price would have to be allocated to a project at the time of purchase. When this is done, the purchasing information for the components bought against a project is retained. It can be recovered through the use of reports in the Project Module. The job costing module will also identify the purchase price information for components allocated to a job or work order.
Another method of tracking original costs is by using Lot Tracking. When Lot Tracking is used, the purchase information is retained with the Lot Information. A report may then be generated to report the original pricing of lot tracked material in inventory.
While these two methods are currently available, a third is in development. When we complete the IPKey development, and of the company elects to use the IPKey tracking, we will be able to create reports that will identify the purchase price of all inventory, although it will not be the book value of inventory.
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| 1.3. Does the Inventory Adjustment account need to be balanced to $0 at month end? | Q. Does the Inventory Adjustment account need to be balanced to $0 at month end?
A. No, only if you wish, you can do a journal entry to clear the account and charge it to any other account of your choice, e.g. COGS.
The inventory adjustment account gathers information from the Cycle Count, Physical Inventory, and the cost rollup modules. The values entered are the offsets of the values actually made to inventory accounts. When we change the value of inventory by adding or removing value (either by change in standard cost or in inventory counts), we have to record the other side of that transaction somewhere, and it goes to this account.
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| 1.4. How Can I Manage Off-Site Production? | Q. How Can I Manage Off-Site Production??
A. See the attached document <<Offsite_Management.docx>> for a suggested process to follow in Offshore/Off-Site Production situations to follow for the safest and cleanest way to manage off-site production using the ManEx system.
This concept assumes that Customer PO’s all come to the main plant, and they want the shipments from the main plant.
When a new customer is obtained, that is okay dealing with the offsite facility, and that facility is up to speed to handle it, new customer PO's can be sent directly to the offsite facility, who then ships directly back to the customer.
This concept can also be used if the main plant wants to use the offsite plant for subassemblies, by simply creating PO's to them for subassemblies.
This arrangement will keep the offsite books tidy, keeping offsite expenses on their own ledger. To keep track of sales by facility, a prefix for the offsite facility can be added to the purchase orders.
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| 1.5. How Does the Std Bld Qty (SBQ) affect the Configuration Variance? | Q. How Does the Std Bld Qty (SBQ) affect the Configuration Variance?
A. First off, the Variance measures the extended cost of the components on the Bill of Materials for an assembly against the standard cost itself of the same assembly. Now, if the user has NOT included setup cost in the standard cost of the assembly, then they should not use the setup cost in kitting, etc. and the variances will track properly.
BUT, if they do use the Setup Cost in kitting, then they should also use it in calculating the standard cost for the assembly. And both will take into account the standard build quantity (SBQ). And I believe that’s where there is the huge difference with different SBQ. They are using setup quantities in kitting, but didn’t use it to set the standard cost.
Now, additionally, the SBQ is used to account for the difference between a work order that was built with a quantity different than the SBQ. If they set a SBQ at 100, (and use the setup quantities in the kit), and build a work order quantity of 100, then yes, they should end up with zero variance. But if they built less than the SBQ, they will have an unfavorable variance. If they build more than the SBQ, then they will have a favorable variance. These cases represent the difference because the value of the setup parts is different from the standard cost when the work order has a different value than the SBQ, and the cost of the setup is amortized across the quantity in the work order.
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| 1.6. How does the Cost Rollup Work in Manex? | Manex Cost Rollup
The first step is to roll buy parts by determining the percentage change from rollups based on average purchases to the current standard cost, and look at a selected group of items. Put another way these would be items for which the average cost varied from the current cost by the percentage entered. If a zero is entered for the percentage, then all items are calculated and displayed.
Then the user has the option to select to change to the average cost, or insert a cost manually, or do nothing. If the user elects to change the standard cost, and there is inventory, there is a cost adjustment transaction to the GL to account for the changed inventory value.
After rolling the costs for buy parts then the user rolls up the buy parts for assemblies. This has to be done for each level of assembly used in your BOMs. The same options are available for modifying the standard cost. One difference for assemblies is that all of the costs in the item master (material, labor, oh, other, UDF) for lower level parts are rolled into the material cost for the upper assembly. There are also calculations that will amortize the cost of setup and run scrap over a standard lot size, to avoid lumping all of these into the cost of one part.
Again, if there is inventory for the parts (assemblies) being changed, then there are GL transactions recorded to account for changes in inventory value.
Where are the standard costs used?
They are used throughout the system for any transaction involving parts and inventory. The standard cost is the value used when material is transferred from one location to another. This includes warehouse to warehouse, to kits, receiving and issuing parts, dmrs, sales orders, etc. The standard is also used to determine the variances. These include purchasing, configuration and manufacturing variances. In Sales Orders, the standard costs are used to determine the Cost of Goods Sold. |
| 1.7. How Unreconciled Receipts Flow Through Accounting? | Q. How Unreconciled Receipts Flow Through Accounting?
A. See Attachment
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| 1.8. How is the Issue Cost on the Kit to Close report calculated? |
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| Answer: |
The Issue Cost is the value of the Parts that have been issued to the Kit.
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Part is valued @ $2.00 each
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Kit Required qty is 30
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The user only picked 10 which left a shortage of 20
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Issue cost would then reflect 10 @ $2.00 = $20.00 for this kit
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BOM Cost would be $60.00 on the report
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Now if you actually over-issued qty to the kit. Required qty was 30 but picked 50 - leaving a over-issue qty of 20 @ $2.00 = $40.00
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Well at the time of closing the kit the report will not include that $40.00 in the Kit to Close report (issue cost would show $60.00), because at that time we do not know if the user is going to return the overissue to stock or cost it to the kit. But upon completeing the kit close process then the system will properly calculate the issue cost of $100.00, and generate the needed Manufacture Variance information. | | |
| 1.9. Is there a report that will give you the Detail of a Kit Closure Variance? | Q. Is there a report that will give you the Detail of a Kit Closure Variance?
A. For further Detail See Article #3235
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| 1.10. Why doesn't the Balance Sheet $$ Match the $$ on the WIP Valuation Report? |
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The value of WIP as determined by the Inventory and WIP Valuation Report is based on the specific material that SHOULD be in the Work Order based on the BOM, less the WO shortages. And is based on the standard cost at the time this report is run. It is basically a REAL TIME report as of the moment it is run.
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Check Setup to make sure that the WIP and WO-WIP have not been assigned the same GL account numbers. The reason is that the inventory report gathers information based on the kitting records, the amount of stuff issued to WIP. Kitting is the only place that material can be placed in WIP. (It is relieved when both work order and kit are closed). So the inventory report is the most accurate assessment of the value of WIP. On the other hand, WO-WIP is really considered inventory, not WIP. WO-WIP is differentiated so that we can keep track of over-issues to work orders for reels and packaged goods that are difficult to issue exact numbers. This allows us to keep track of such inventory, and is available to meet demands for MRP. IF you happen to have the WIP and WO-WIP using the same GL account numbers transactions will be placing material in WO-WIP through kitting was also placing the value in the WIP account in the GL. So the GL will show both the WIP and the WO-WIP, and the inventory report will only show the actual WIP values. The inventory report includes the WO-WIP in the INVENTORY column, not the WIP column.
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| 1.11. Why is the Transaction Date 01/01/02 appearing on new Records? | A. Why is the Transaction Date 01/01/02 appearing on new Records?
Q. Check the computers's internal battery it may be weak or dead. The date 01/01/02 is the default date that a PC displays if the internal battery that keeps the date/time function running goes dead. The fields that have the date 01/01/02 are fields that are populated with the VFP function DATE(), which picks the date up from the local computer that the application is running on. That's the only way we can get what we believe is the current date.
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| 1.12. Why doesn’t the Kitting screen and WO Shortage Reports include Setup Scrap? | Q. Why doesn’t the Kitting screen and WO Shortage Reports include Setup Scrap?
A. The Setup Stscp box MUST be checked on the BOM Header Information if you want the setup scrap qty’s to be included in the Kitting, WO Shortage Reports and MRP calculations.
If you want the Run Scrap qty’s to be included in the Kitting, and WO Shortage Reports the Run Scrap must be selected in the Kit Default Setup .
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| 1.13. WIP Value | | WIP Value Article #893
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