DBD: Inventory - Job Costing Feature & Processing Rules

System Parameter: Order Processing > Setup > System > System Setup > Parameters > Panel 7 > Enable Inventory Costing Feature = Y   

⚠️ Important: This feature is parameter-driven. Once activated, the rules below apply to all new B-type orders. Existing orders already in the system will continue to process under legacy logic.

Section 1: Mandatory Order Entry Rules

To maintain system data integrity and prevent calculation errors, the order entry team must strictly adhere to the following layout constraints for B-type orders:

• Line 001 Restriction: Line 1 must always be the core inventory item. Only one item is permitted per job costing order.
• Subsequent Lines: Enter all auxiliary vendor charges (artwork, freight, plate fees) on subsequent lines (Line 002, 003, etc.) using S-type (Special Charge) lines.
• No Zero Costs: Every single line on the order must include an estimated cost. If a cost is completely unknown, enter a baseline estimate of .01    as a placeholder. Never leave a cost field blank or at 0.00.
• Freight Requirements: Freight must be entered as an explicit line item. This may differ from your standard commercial sales order policies.
• Single Destination Warehouse: The entire order must ship to one single warehouse location. The shipping point record in order entry must be set to 1   . Note: If stock needs to be split later, complete the PO receipt first, then utilize a standard Inventory Transfer to move balances.

Section 2: Financial & G/L Posting Logic

As orders move from receiving to invoicing, the system dynamically routes costs depending on whether the core product (Line 001) has been invoiced by the supplier.

1. Inventory in Progress (Line 001 Not Yet Invoiced)

If auxiliary special charges are received before the vendor invoice for Line 001 is processed, the system flags these amounts as Inventory in Progress.

• G/L Impact: Dollars route to your dedicated Inventory in Progress G/L Account (defined via AR > Setup > System > System Setup > Sale Dist G/L Interface    using the product code from Line 001).

2. Actual in Inventory (Line 001 Invoiced)

If the vendor invoice for the core product has already been processed, incoming special charges are marked as Actual in Inventory.

• G/L Impact: Dollars post directly to your primary Inventory Asset G/L account.

3. Handling Cost Variances (Unallocated Costs)

When a final vendor invoice differs from your original line estimates, the system attempts to update the cost baseline of any remaining physical lots (including those already committed to open orders).

• If No Lots Remain: Any cost variance is written off as Unallocated Cost.
• Best Practice: Review your Unallocated Cost reports monthly and clear them via a manual journal entry to back the variance out of inventory and charge it against commissions payable or your cost of goods sold (COGS) accounts.

Section 3: Bypassing Job Costing by Order

For complex orders requiring multiple custom items on a single record (such as Ad Specialty orders), authorized operators can manually bypass the job costing logic.

• Path: Setup > System Utility Functions > Administrator Function > System Access and Security > Appl Security by Operator > Setup IV
• Setting: Toggle "Allow access to the Job Costing Flag on the Order Entry Header?" to Y.

How to Bypass in the Header

Authorized operators will see an extra flag in the Sales Order Header screen. This must be checked prior to exiting the header fields:

• Sales Order Header 2 (Order Info Panel): Check the box for Turn off Job Costing.

Section 4: Inventory Costing Transaction Report

Use this report to audit your works-in-progress, track unallocated cost variations, and clear old data to history.

• Path: Inventory Control > Reports > Inventory Costing Trans

Key Report Parameters

• Sort Options:
  • Salesperson: Allows narrowing criteria by specific customer and item ranges.
  • Sales Order Number: Best option for reconciling the exact financial history attached to a single job number.
• Filter Toggles:
  • Only Print Orders with Unallocated Cost: Isolates records needing commission chargebacks or manual G/L journal write-offs.
  • Only Print Orders with Actual in Progress: Targets special charges where the supplier invoiced you for the fees, but has not yet invoiced the core product.

💡 Maintenance Note: Upon printing, the system will prompt you to safely migrate closed transactions over to your long-term history files, provided the order is finalized and all related stock lots have departed the primary warehouse.