<?xml version="1.0" encoding="utf-8"?>
<ManualTopic ID="/baanerp/ti/onlinemanual/000080" xml:lang="en">
   <Header>
      <Title>Cost components in Manufacturing</Title>
      <Keyword type="header" order="d1e2060968">
         <Level1>Cost components</Level1>
         <Level2>Manufacturing</Level2>
      </Keyword>
   </Header>
   <GeneralSection>
      <Paragraph>Cost components are used
		to break down calculated prices into components that are meaningful to the
		user. In other words, cost components offer a user-defined cost structure of
		cost prices, sales prices, and valuation prices.</Paragraph>
      <List>
         <ListIntro>Cost components are also used for the following purposes:</ListIntro>
         <ListItem>To compare estimated and
		  actual production order costs.</ListItem>
         <ListItem>To express production
		  variances.</ListItem>
      </List>
      <Paragraph>Cost component codes are
		defined in the <GUIRef href="/baanerp/tc/mcs/tcmcs0148m000" role="session">Cost Components (tcmcs0148m000)</GUIRef> session, and assigned to one of the
		following cost types:</Paragraph>
      <List>
         <ListItem> 
            <GUIRef href="/baanerp/tc/domains/cref#material" role="option">Material Costs</GUIRef>
         </ListItem>
         <ListItem> 
            <GUIRef href="/baanerp/tc/domains/cref#operation" role="option">Operation Costs</GUIRef>
         </ListItem>
         <ListItem> 
            <GUIRef href="/baanerp/tc/domains/cref#chg.material" role="option">Surcharge on Material Costs</GUIRef>
         </ListItem>
         <ListItem> 
            <GUIRef href="/baanerp/tc/domains/cref#chg.operation" role="option">Surcharge on Operation Costs</GUIRef>
         </ListItem>
         <ListItem> 
            <GUIRef href="/baanerp/tc/domains/cref#transfer" role="option">WIP Transfer Costs</GUIRef>
         </ListItem>
         <ListItem> 
            <GUIRef href="/baanerp/tc/domains/cref#general" role="option">General Costs</GUIRef>
         </ListItem>
         <ListItem> 
            <GUIRef href="/baanerp/tc/domains/cref#not.appl" role="option">Not Applicable</GUIRef>
         </ListItem>
      </List>
      <Paragraph>The cost component type <GUIRef href="/baanerp/tc/domains/cref#not.appl" role="option">Not Applicable</GUIRef> is intended for use in <GUIRef href="/baanerp/tp" role="package">Project</GUIRef> and <GUIRef href="/baanerp/ts" role="package">Service</GUIRef>.</Paragraph>
      <Paragraph>You must link a cost
		component of the applicable costing type to everything in LN that is accountable
		for costs: materials, operations, surcharges, labor, and so on.</Paragraph>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>Cost component structure</SectionTitle>
      <Paragraph>In the cost component
		structure, you determine how a price is broken down. You can choose to break
		down the costs for every cost component in LN. You can also
		aggregate the costs on the three cost components defined in the <GUIRef href="/baanerp/ti/cpr/ticpr0107m000" role="session">Items - Costing (ticpr0107m000)</GUIRef> session. In other words, in the cost component
		structure, you can break down the price to the level of detail you want: from
		completely aggregated until detailed in a greater or less degree.</Paragraph>
      <GeneralSection>
         <SectionTitle>To set up a cost component structure: aggregated
		  costs</SectionTitle>
         <Paragraph>In the <GUIRef href="/baanerp/ti/cpr/ticpr0107m000" role="session">Items - Costing (ticpr0107m000)</GUIRef> session you must define three aggregated cost
		  components for an item. The aggregated cost components are associated with the
		  following costs:</Paragraph>
         <List>
            <ListItem>Material costs.</ListItem>
            <ListItem>Operation costs.</ListItem>
            <ListItem>Surcharge costs.</ListItem>
         </List>
         <List>
            <ListIntro>If you do not enter a chart in the <GUIRef href="/baanerp/ti/cpr/ticpr0107m000#ticpr007.chrt" role="manual">Cost Component Chart</GUIRef> field in the <GUIRef href="/baanerp/ti/cpr/ticpr0107m000" role="session">Items - Costing (ticpr0107m000)</GUIRef> session, or for <GUIRef href="/baanerp/ti/asc" role="module">Assembly Control</GUIRef> in the <GUIRef href="/baanerp/ti/cpr/ticpr0115m000" role="session">Assembly Line Costing Data (ticpr0115m000)</GUIRef> session, all costs are broken down on the
			 aggregated cost components. This means in <GUIRef href="/baanerp/ti/sfc" role="module">Shop Floor Control</GUIRef> that
			 if you report an order or a quantity as complete, and the items are received in
			 the warehouse, the following happens:</ListIntro>
            <ListItem>All cost linked to
			 cost components of the <GUIRef href="/baanerp/tc/domains/cref#material" role="option">Material Costs</GUIRef> type are booked on the aggregated cost component for material
			 costs.</ListItem>
            <ListItem>All cost linked to
			 cost components of the <GUIRef href="/baanerp/tc/domains/cref#operation" role="option">Operation Costs</GUIRef> type are booked on the aggregated cost component for operation
			 costs.</ListItem>
            <ListItem>All cost linked to
			 cost components of the <GUIRef href="/baanerp/tc/domains/cref#chg.material" role="option">Surcharge on Material Costs</GUIRef> type or the <GUIRef href="/baanerp/tc/domains/cref#chg.operation" role="option">Surcharge on Operation Costs</GUIRef> type are booked on the aggregated cost component for
			 surcharge costs.</ListItem>
         </List>
      </GeneralSection>
      <GeneralSection>
         <SectionTitle>To set up a cost component structure: detailed
		  costs</SectionTitle>
         <List>
            <ListIntro>If you want to break down your costs in a detailed way, you
			 must, apart from the aggregated cost components, define detailed cost
			 components in the <GUIRef href="/baanerp/ti/cpr/ticpr0110m000" role="session">Chart Details (ticpr0110m000)</GUIRef> session. The detailed cost components are linked to a chart that is defined in
			 the <GUIRef href="/baanerp/ti/cpr/ticpr0109m000" role="session">Cost Component Charts (ticpr0109m000)</GUIRef> session. If you enter the chart with associated
			 detailed cost components in the <GUIRef href="/baanerp/ti/cpr/ticpr0107m000#ticpr007.chrt" role="manual">Cost Component Chart</GUIRef> field in the <GUIRef href="/baanerp/ti/cpr/ticpr0107m000" role="session">Items - Costing (ticpr0107m000)</GUIRef> session, or for <GUIRef href="/baanerp/ti/asc" role="module">Assembly Control</GUIRef> in the <GUIRef href="/baanerp/ti/cpr/ticpr0115m000" role="session">Assembly Line Costing Data (ticpr0115m000)</GUIRef> session, all costs are broken down
			 according to the cost component structure (chart details) that you defined for
			 the chart. This means in <GUIRef href="/baanerp/ti/sfc" role="module">Shop Floor Control</GUIRef> that if you report an order or a quantity as complete,
			 and the items are received in the warehouse, the following happens:</ListIntro>
            <ListItem>Costs are booked to
			 the matching cost component in the cost component structure.</ListItem>
            <ListItem>If costs were linked
			 to a cost component in LN that does not exist in the end item's cost component structure,
			 the costs are collected in the end item's aggregated cost component.</ListItem>
         </List>
      </GeneralSection>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>Booking costs on cost components</SectionTitle>
      <List>
         <ListIntro>During production of a manufactured item, all costs are
		  booked on the cost component to which the costs are linked. These cost
		  components can differ from the cost components in the end item's cost component
		  structure.</ListIntro>
         <ListItem>Operation costs are
		  booked on the cost component as defined in the <GUIRef href="/baanerp/ti/cpr/ticpr1150m000" role="session">Operation Rates (ticpr1150m000)</GUIRef> session.</ListItem>
         <ListItem>Material costs are
		  booked on the materials' cost components. You can view the cost components in
		  the <GUIRef href="/baanerp/wh/wmd/whwmd2517m000" role="session">Item Inventory - Cost Details (whwmd2517m000)</GUIRef> session.</ListItem>
         <ListItem>Surcharges are booked on
		  the cost component as defined in the <GUIRef href="/baanerp/ti/cpr/ticpr1110m000" role="session">Item Surcharges (ticpr1110m000)</GUIRef> session.</ListItem>
      </List>
      <Paragraph>After production, if you
		report an order as complete and the items are received in the warehouse, the
		costs are booked on the cost components as defined in the end item's cost
		component structure. If the <Link href="/baanerp/ti/sfc/tisfc0501m100#tisfc001.mocp" role="formfield">Moment Completion Posting</Link> field in the <GUIRef href="/baanerp/ti/sfc/tisfc0501m000" role="session">Production Orders (tisfc0501m000)</GUIRef> session is <GUIRef href="/baanerp/ti/domains/sfc.mocp#qty.compl" role="option">Quantity Completed</GUIRef>, the costs are booked as soon as a quantity of the
		production order is reported completed.</Paragraph>
      <Note>
         <SectionTitle>Note</SectionTitle>
         <Paragraph>In <GUIRef href="/baanerp/ti/asc" role="module">Assembly Control</GUIRef>, a chart
		  with detailed cost components is linked to the assembly line instead of to the
		  end item.</Paragraph>
      </Note>
   </GeneralSection>
   <ExampleSection>
      <SectionTitle>Example</SectionTitle>
      <Figure space-and-orientation="indented-estimated">
         <HTML:IMG xmlns:HTML="http://www.w3.org/TR/REC-html40" height="212" width="525"
                   SRC="../images/tr_graph_tiom000080.gif"
                   alt="[...]"/>
      </Figure>
      <Paragraph>Explanation:</Paragraph>
      <Paragraph>If you defined a
		detailed cost component SURCH_C for component item C in the <GUIRef href="/baanerp/ti/cpr/ticpr0110m000" role="session">Chart Details (ticpr0110m000)</GUIRef> session, and you want to report the costs that are
		posted to that detailed cost component SURCH_C separately for end item A, you
		must also define cost component SURCH_C in the chart details for end item A. If
		you do not define a cost component SURCH_C for item A, cost component SURCH_C
		will be part of item A's aggregated cost component SURCH_A. You must define the
		detailed cost components of an item's cost component structure in the <GUIRef href="/baanerp/ti/cpr/ticpr0110m000" role="session">Chart Details (ticpr0110m000)</GUIRef> session.</Paragraph>
   </ExampleSection>
   <RelatedTopics>
      <SectionTitle>Related topics</SectionTitle>
      <RelTopic>
         <Link href="/baanerp/tc/onlinemanual/000390" role="manual">Cost components</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/ti/onlinemanual/000093" role="manual">Aggregated cost components</Link>
      </RelTopic>
      <RelTopic>
         <Link href="/baanerp/ti/onlinemanual/000094" role="manual">Detailed cost component</Link>
      </RelTopic>
   </RelatedTopics>
</ManualTopic>