Maybe @Nancy_Hoyt can help me out or another costing expert…
How are you handling the SG and A expenses in your unit price? Is it a markup on the quote?
Looking to learn more about selling, general, and admin expenses and how to roll those into a cost/price in Epicor.
Hi Utah,
I’m FAR from a costing expert. However, I have some understanding of how we are handling it, some good some ugly. We use standard costing on our parts that are not “non stock”. This standard cost has associated material cost, labor cost, burden cost (burden includes the extra SGandA $ I think), and subcontract cost built into the cost of our parts.
Annually we do a cost roll of manufactured parts and our cost accountant (AlThomas on here) updates the standard cost of our parts. He also updates cost for purchase price variances from the prior year. Our nonstock parts are average costed, not standard.
Now for our quotes we have a markup from cost being applied, entered into the Sales Price on the Part for parts that are NOT non stock and we also use customer price lists for these parts for customers/types of customers for whom we have pricing agreements. As far a our non stock parts go, we use another Quotation program to configure the part (pumps) and a multiplier is used there with the configurator to get a sales price. I would love to see this Quotation program tied to our costs in Epicor, but alas that is not currently done.
Let me know if you have any questions and I can try and answer or ask Al to.
Nancy
@Nancy_Hoyt thank you for responding to the question, that helps a lot. @althomas is the SG and A cost really rolled into your burden cost on the part’s standard cost elements?
@Nancy_Hoyt the company is all discrete manufacturing so the finished good isn’t stocked. I think we would have to use a markup then on the quote.
Utah,
We don’t have the SG&A cost rolled into burden. We only have factory overheads (indirect materials, indirect labor, factory utilities, shop supervisor salaries, etc.) related to making the parts.
The SG&A expenses are tracked separately in the Income Statement and not part of cost of goods sold (material, labor, burden, subcontract costs). each SG&A have their own GL Accounts depending on what Department and plant, when we entered the expense. They are finally accumulated below the Gross profit line in the income statement.
Sales
-Cost of Sales (standard cost [material, labor , burden, subcontract])
Gross Profit
-SG&A Exenses
Operating Profit
-Taxes
Net income
@Nancy_Hoyt , how are you doing this? It was my understanding that Non-Stock parts can only be standard costed.
Thank you so much for the breakdown @althomas !
Are you accounting for the SG and A though with a markup on the quote as @Nancy_Hoyt said?
Hi John,
I think that because they are not standard costed, and nonstock therefore Make-direct, the cost of the job gets tied to the shipped order. I don’t think it actually does the average cost on the part, it just doesn’t do a standard cost. See system help highlighted. Once again I defer to accountants on this 
Nancy
In other words, how exactly are you covering these SG nad A expenses with the price of your goods, do you do this on quote entry? a part’s sales price? etc.? Where/what in epicor are you using to make sure that those expenses are priced in?
Utah,
Our sales dept. handles the pricing of the parts. I really don’t get involved with how they are coming up with that markup. I work in the cost accounting side, so i am not familiar with what other factors besides the standard cost is involved in determining the sell price/ markup. - Sorry 
John,
The top level products that are not standard cost’d are very much engineered and unique. They are using average costing, but since that part number is used only once because each product is unique with design specs, the average cost is the actual cost (average of 1).
I really appreciate your input! Thank you!
If it’s not too much to ask do you think you could ask someone there how they are handling the SG and A expenses? If it’s not too prying?
If not, I totally understand, totally understand.
