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Dynamics GP backflush setup labor for standard cost item bug

  • 1.  Dynamics GP backflush setup labor for standard cost item bug

    Posted Nov 11, 2020 03:07 PM
    ​I did this testing with V 18.00.0704, Mfg 10.0.628.

    The item being made uses periodic (standard cost) valuation.  The routing is one sequence with 1 hour setup and .25 hour run time per piece.  Labor and machine time is back-flushed.

    For standard cost purposes, the system is configured to prorate setup using standard quantity.  For this item, the standard quantity is 20.

    I created an MO for a quantity of 20.  I received 20, back-flushing labor and material.

    Per the "tech knowledge" titled "Description of the causes of labor variance when you enter standard cost manufacturing orders and when all labor is backflushed in Manufacturing in Microsoft Dynamics GP",:

    The setup labor is prorated by using the standard quantity

    1. Cost Put into WIP = Setup Time from the Routing
    2. Cost Consumed from WIP = (Setup Time from the Routing / Standard Quantity) x (MO Quantity)
    If the MO Quantity is equal to the Standard Quantity, there will be no labor variance.

    My MO had a labor variance.  Turns out that when it put the labor cost into WIP, it took the ((setup time / standard quantity) * 1) instead of taking the cost of the full hour.  So only the cost of .05 hr of setup was put into WIP.  As a result, I get a labor variance on MO close.  (On the variance window it does show the full hour in "costs put into WIP/Labor Hours"; it is only the Labor cost that is updated incorrectly.)

    Do we know what versions of GP have this bug and if it is fixed in V18.3?
    MO variance example

    Al Schuette
    Senior Business Consultant
    Heartland Business Systems
    Little chute WI
    Academy - Online Interactive Learning from Experts

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