I believe I have a big issue that I’m not sure how to handle. we are using std. costing. I am not convinced our standards are correct. I recently trained all shop employees how to use MES to record labor and discovered that all operations are marked quantity only or backflush. If our standards aren’t right this leads to incorrect job costing. My plan is to change all operations to labor and quantity and get actual costing. compare this to the standard and where there is a variance +/- x percentage we look closer and see if it was due to an issue or if our standards are off. I have little to no experience with std. costing in epicor. I understand the concept but need to have a few questions answered.
- if I switch to labor and qty reporting will it be detrimental other than seeing more variances in the general ledger?
- Why have we been seeing labor variances in the general ledger when it is quantity only or backflush?
Any suggestions or conversation is also welcome.