Is there any way to assign a start production date and finish production date to the production order
Because in an industrial project, it’s obliged to determine how much is the cost or the quantity of the underproduction In the profits and loss statement
Use custom fields.
These will have no financial impact, however. They will not impact your profit and loss statement in any way.
It is not clear why you would be using production orders in industrial project management. They are used in Manager only to record production of inventory items.
In industrial project, the production may take several days eg. chicken eggs’ hatching or concrete beams precasting
So I should know the right amount of money I’m investing to produce these beams especially in the end of the financial period
Maybe this is an idea to develop the program
Understand, @Muslim, that the program is never going to figure out your investment for you. A production order requires you to specify the inventory items you are consuming. Their costs are transferred to the new item. Non-inventory costs must be specified by you. Start and finish dates have nothing to do with that.
Then you should be using work-in-progress accounting assuming that the concrete beams are for a client not self use. You store the “investment” in a balance sheet asset account and transfer to the P&L when the client is invoiced.
Alternately, in a limited way you can use tracking codes and transfer un-invoiced production expenses to the BS via Journal Entries.
To understand my point I quoted this paragraph from an Arabic accounting site
Production under operation:
- Materials that have entered the production process and are not yet fully produced.
- At the end of the accounting period, the company does not stop production, which means that when the accounts are closed, there are still goods in the manufacture, they are not raw materials or finished goods , but they are production under operation.
- Production under operation is considered as an asset in the budget usually a value higher than the value of raw materials entered and less than the value of finished goods. It is often calculated as a percentage of the value of finished products and this percentage is determined by experts at the establishment.
So if the production order contains a production start and finish dates, an extracted production progress percentage will help to determine a value of these products under operation
And remember, during the production operation I don’t have neither a raw material nor the final product in my warehouse/inventory . So how I’ll justify the difference between what i have and what I should have in my income statement
Yes, that concept is fully understood as previously mentioned - work-in-progress accounting.
What you have never disclosed is this - are the industrial products coming from raw material inventory or direct purchases. Regardless of which - the inputs will be held in a state of transfer and held as work-in-progress until completed.
Neither affect your income statement. Your income statement is only affect by sales and the related costs to those sales. As you are still under production no sale has occurred.
So you prefer to consider the under operation products as a raw material until the production is completed
Even if there’s a difference between the value of a raw material and under operation products .!!
If this is important to you, then you need to break your production flow up into smaller stages, with several production orders. Add whatever non-inventory costs are appropriate at each stage. The increasing asset value will be shown in the Inventory on hand balance for the interim stage products.
(A) Not necessarily
(B) This entirely depends on the postings of related transactions.
You haven’t answered the question: are the industrial products coming from raw material inventory or direct purchases.
They came from transformed raw material
So the value of under operation products have upper value than raw material and lower one than the final product
Also the transformation has a duration to be achieved