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Evo-ERP and DBA Classic >> Manufacturing >> Indirect Work Orders
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Message started by GasGiant on 05/21/08 at 05:36:36

Title: Indirect Work Orders
Post by GasGiant on 05/21/08 at 05:36:36

We have been using indirect Work Orders to issue parts to projects. It works well to get the parts out of stock and assigned to the right job, but how do the parts get out of WIP? Why do they go into WIP? There seems to be a piece that I have forgotten about.

Title: Re: Indirect Work Orders
Post by lmk223a on 05/21/08 at 06:10:00

What is the part type and product class for the part number on your indirect work order?

When I create an indirect work order, the part type is "N" for noninventory and the product class is one that either charges Engineering or Shop Expense so charges are not assessed to WIP.

Title: Re: Indirect Work Orders
Post by GasGiant on 05/21/08 at 06:53:36

Well, that must be the answer. I went in and looked and sure enough, the WOs that had WIP parts where for projects set up as type F instead of type N. I think someone lost the instructions I gave them last August and just started doing it their own way. Thanks for the reminder!

Title: Re: Indirect Work Orders
Post by cathyh on 05/21/08 at 08:02:09

The class code is the most important part. Even if the part is type "N' the cost will go to the WIP GL account if the class has that account for WIP. You need to set up a class that has the expense account you want the costs to go to as the WIP and ASSET accounts. The COGS can be the regular account if you think you might sell it.
Also, when you are printing the WIP summary you want to exclude I type work orders.

Title: Re: Indirect Work Orders
Post by GasGiant on 05/21/08 at 09:22:56

The class code was correct (PJ for projects), but there were only a few that were correctly typed as N, which is what the instructions I gave them a year ago said to use.

Now that I have corrected the type, I have no idea how to get the parts out of WIP. Will we have to back the parts out of the Work Orders and reissue them? Ick.

Title: Re: Indirect Work Orders
Post by cathyh on 05/21/08 at 09:54:08

Do you mean that the are listed in the WIP summary report? Or the costs are in the WIP GL Account?

If you have given the work order a "I" status for indirect, then when you print your WIP summary and exclude "I" types you won't see them in your summary.

This is important to match the WIP summary to the GL. Your class code for your indirect work order is directing the WIP issues to a different GL account than your "R" type work orders.

If you did not have the correct class code and then changed it so that some issues have already been done to the wrong GL account, you would have to change the class code back to the incorrect one before backing out of the issues. Then change the class code again and reissue. We usually just do a journal entry adjustment between the expense account and the WIP account to correct issues that have been made using the wrong class code for a part.

Hope any or all of this helps.

Title: Re: Indirect Work Orders
Post by GasGiant on 05/21/08 at 10:12:26

I'm only talking about the items, no the GLs. PI is coming up and I will need to empty WIP.

The classes were all fine, only the type was wrong. I need to get the parts out of WIP without having them wind up in inventory, which is where they would go if I were to close the Work Orders. Normally, I close all WOs before freezing PI so that all of the parts and the money shakes out of WIP.

Title: Re: Indirect Work Orders
Post by cathyh on 05/21/08 at 11:34:42

I get it now, Colin- Finishing production and closing does get it out of WIP but if you don't want it to show up on your inventory value report it needs to be an "N" type.

We carry a lot of WIP every month and aren't trying to get it out at the end of the month for PI. The problem we always have is that a work order that should be I is R and our WIP summary doesn't match the GL account.