Inventory Production Entry

 

Function

Inventory Production Entry allows input of items that are assembled or produced according to the definitions contained in the Bill of Materials Master File. This is the first step in a bill of materials explosion process that automatically relieves the component parts inventory according to bill of materials definitions, a process that is often referred to as back flushing. The actual relieving of inventory items takes place in an update process after the Inventory Production Register is printed. Individual component items that are not part of a bill of materials definition, but are required in the assembly process, also may be issued to production when using this program.

 

=> To access this task...

Select Inventory Production Entry from the Bill of Materials Processing menu.

 

Inventory Production Entry

 

About the Fields

  • Click the record navigating buttons; to view the first record, to view the previous record, to view the next record and to view the last record.

  • To enable edits to the form select  .

In the Warehouse ID field...

  • Enter the two-character identification code for the warehouse in which this production entry is to be recorded.

  • Press [Tab] or [Enter] to accept the default warehouse.

  • Click Find field records to select from a list of warehouse codes.

The warehouse description will be displayed. In a multiple warehouse situation, this specifies the location from which the component parts will be taken as well as where the finished items will be received.

 

In the Production Date field...

  • Enter the production or assembly date of this item.

  • Click Calendar to select a date using the calendar tool.

The production date may be interpreted differently depending on a company’s requirements. For example, it may be used to indicate the date the request was issued, the date the finished assembly is required internally, or the date the finished items will be available for customer pickup or shipment. The production date is used as the general ledger date and the inventory posting date for the transaction.

 

In the Reference field...

  • Enter a seven-character reference code that will be used to identify this transaction.

This field may be used for a customer order number, an internal work order number, routing information, required date, etc.

If a production entry already exists for the entered warehouse ID, production date and reference code, it will be retrieved and displayed on the screen. Changes to these entries can be made.

 

In the Bill/Item Number field...

  • Enter the number of the item that is to be produced.

  • Click Find field records to select from a list of all valid item numbers.

  • Click the record navigating buttons; to view the first record, to view the previous record, to view the next record and to view the last record.

The item number must be a valid bill of materials number (as defined in the Bill of Materials Master File) or a valid inventory item number (as defined in the Inventory Master File). The item description from the Inventory Master File will be displayed.

 

NOTE: Generally, inventory items entered through Inventory Production Entry will have a corresponding bill of materials definition with a matching bill number. An item is not required, however, to have a corresponding bill of materials definition in order to be processed through Inventory Production Entry. If no corresponding bill exists, only the quantities for the item itself are added to (or subtracted from) the inventory during Inventory Production Register update.

 

In the Unit of Sale field...

Display only. Shows the standard unit of sale for the selected item, entered in the Inventory Master File.

 

In the Item Quantity field...

  • Enter the quantity of the item you want to produce.

This is usually the production quantity of an item that has a bill of materials definition. The item quantity will be used as a multiplication factor when exploding the bill and relieving the component parts from inventory.

 

NOTE: Some production or assembly processes may require component parts that are not part of a bill of materials definition. In such cases, the items may be automatically issued from inventory by specifying the desired inventory item number at the Bill/Item No field and entering the quantity as a negative number.

 

Update Flag checkbox...

For items that have a bill of materials definition, this field allows the operator to control whether the finished items are to be automatically added to the inventory during the Inventory Production Register update (checked, i.e. post-production mode), or if only the component parts are relieved, without automatically adding the finished items to inventory (unchecked, i.e. pre-production mode.

  •  Mark the box to add the finished items to inventory while relieving the component parts

  • Unmark the box to relieve only the component parts without automatically adding the finished items to inventory. If unchecked and the inventory item has no bill definition, no update will take place for the item.

NOTE: Update Item is used to allow operation of the Inventory Production Entry process in either a pre-production or a post-production mode. Refer to the following page for a complete explanation of these two methods of using Inventory Production Entry.

 

When finished making entries to the fields…

  • Click Save current data to save the record. It will be updated to the inventory production data entry file and will be included when the Inventory Production Register is printed.

  • Click New/clear form to clear the form and begin again.

  • Click Delete current record to delete the entry

Pre-Production versus Post-Production Modes of Operation

The Update Flag question allows use of Inventory Production Entry in either pre-production mode, or a post-production/inventory usage recording mode. Most businesses will operate the Inventory Production Entry using one of these methods.

 

Pre-Production Mode of Operation

In a pre-production mode, an Inventory Production Entry and an Inventory Production Register are run before the items are produced, making it possible to plan inventory requirements and check availability before beginning production. The Inventory Production Register is used as a planning tool to find out what quantity of each part is required, and the availability of component parts for each item that is to be produced. In this mode, the operator enters the number of items to be produced, with the Update Flag unchecked. This will result in only the bill of materials component parts being relieved from inventory during the Inventory Production Register update process (finished goods will not be received at this time). Later, after the finished items are produced, they are manually added (received) into inventory using the standard inventory transaction entry programs.

 

Post-Production Mode of Operation

A post-Production mode is used when the production entry process is performed after the items are produced. When this is the case, the planning information on the Inventory Production Register is of little value. In this mode, the operator enters the number of items to be produced, with the Update Flag checked. This results in both the component parts being relieved from inventory and the finished items being added to inventory as part of the production entry update process. The post-production method is best used when the production schedule is being established using information outside the scope of the Bill of Materials and Inventory Control modules. The Inventory Production Entry process is then used to record the completion of finished items and the usage of component parts.

 

NOTE: Because Standard Lot Size is used in calculating actual setup time for each finished good, the cost of the finished good will vary from the cost shown on the bill if:

 

1.    The quantity you intend to produce differs from the standard lot size.

2.    Setup times are used.

 

Also note that if the standard costing method is used, the differences (if any) will be reflected in the Production Variance Account.

 



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