Standard vs. Average costing

Yahoo Archive
1
Joe-

We chose to go with standard cost on manufactured parts-and the cost is
revisited periodically by accounting and adjusted as needed, and we use
average costing for our purchased parts-in the long run, the timing issues
are less important on our purchased parts than the average costing turned
out to be.

Just our input.

Lydia
Canyon Engineering Products, Inc.

We are just starting to implement Vantage and are stuck in a costing debate.
We are a high volume manufacturer of fasteners and have traditionally been
standard cost. I would like to receive input as to how adept Vantage is at
standard cost, whether the average costing works well, what to be concerned
with, etc

Thanks

Joe Holloway
Technifast Industries
2
We are just starting to implement Vantage and are stuck in a costing debate.
We are a high volume manufacturer of fasteners and have traditionally been
standard cost. I would like to receive input as to how adept Vantage is at
standard cost, whether the average costing works well, what to be concerned
with, etc

Thanks

Joe Holloway
Technifast Industries
3
We were on Standard costing before we went with Vantage last year. We went to average costing with Vantage and have been lost ever since (as far as really knowing if we're making a true profit or not). It's been a mess because so many quirky things seem to make the Avg. cost go up and down. I don't think the problem is all Vantage's -- it's lots of new employees, and years of doing things the lazy way.

The bottom line... We wish we were back on Standard costing.

Troy Funte
Liberty Electronics

----- Original Message -----
From: Joe Holloway
To: vantage@egroups.com
Sent: Monday, January 08, 2001 8:41 AM
Subject: [Vantage] Standard vs. Average costing




We are just starting to implement Vantage and are stuck in a costing debate.
We are a high volume manufacturer of fasteners and have traditionally been
standard cost. I would like to receive input as to how adept Vantage is at
standard cost, whether the average costing works well, what to be concerned
with, etc

Thanks

Joe Holloway
Technifast Industries



eGroups Sponsor


We no longer allow attachments to files. To access/share Report Files, please go to the following link: http://www.egroups.com/files/vantage/
(Note: If this link does not work for you the first time you try it, go to www.egroups.com, login and be sure to save your password, choose My Groups, choose Vantage, then choose Files. If you save the password, the link above will work the next time you try it.)



[Non-text portions of this message have been removed]
4
We use Average costing for purchased inventory items because they are
generally more stable cost wise, and we use Standard costing for the
items we manufacture because of many variables such as setup time/$,
quantity made, and other special circumstances.

Rick Gors
MR/MMIS
Osco

Joe Holloway wrote:
>
> We are just starting to implement Vantage and are stuck in a costing debate.
> We are a high volume manufacturer of fasteners and have traditionally been
> standard cost. I would like to receive input as to how adept Vantage is at
> standard cost, whether the average costing works well, what to be concerned
> with, etc
>
> Thanks
>
> Joe Holloway
> Technifast Industries
>
> We no longer allow attachments to files. To access/share Report Files, please go to the following link: http://www.egroups.com/files/vantage/
> (Note: If this link does not work for you the first time you try it, go to www.egroups.com, login and be sure to save your password, choose My Groups, choose Vantage, then choose Files. If you save the password, the link above will work the next time you try it.)
5
Stick with standard cost. There are so many timing issues with average cost
it's not worth the headaches and surprises.
Greg Clauser
Lakin General Corporation
gclauser@... <mailto:gclauser@...>


We are just starting to implement Vantage and are stuck in a costing debate.
We are a high volume manufacturer of fasteners and have traditionally been
standard cost. I would like to receive input as to how adept Vantage is at
standard cost, whether the average costing works well, what to be concerned
with, etc

Thanks

Joe Holloway
Technifast Industries
6
Here is a thread from some time ago which describes some of the 'potholes' involved with Avg. costing...

----- Original Message -----
From: Greg Clauser
To: 'vantage@egroups.com'
Sent: Monday, October 30, 2000 3:47 PM
Subject: RE: [Vantage] Receipt from mfg. costs


We also use average costing and discovered the same "zero cost"
transactions. With a new part, if you receive it into stock before all the
labor (and subcontract) transactions that produced it are processed the cost
will be wrong. What's worse (and even easer to do) is to "backflush" or
issue a stocked sub-component to another job (or ship it to a customer)
before it gets a cost established from a MFG-STK transaction.
These timing problems can play havoc with costs applied all the way down the
line. The only practical solution we've found was to establish and enter a
"starting point" cost when creating a new part. We're on average costing
but I have the system calculate the standard cost and plug that in as the
starting average cost. However, any old ballpark guess at what the cost
should be is way better than leaving it blank. Wish they had covered this
little "gotcha" in implementation/training. Average cost in Vantage seems
to have a lot of potholes you have to watch out for. Negative inventory
balances, adjustments when jobs close, and backflushing can all screw things
up big time. Do not even attempt to "auto-receive" unless you are on
standard cost.
Greg Clauser
Lakin General Corporation
gclauser@... <mailto:gclauser@...>
----- Original Message -----
From: Greg Clauser
To: 'vantage@egroups.com'
Sent: Tuesday, January 09, 2001 8:45 AM
Subject: RE: [Vantage] Standard vs. Average costing


Stick with standard cost. There are so many timing issues with average cost
it's not worth the headaches and surprises.
Greg Clauser
Lakin General Corporation
gclauser@... <mailto:gclauser@...>


We are just starting to implement Vantage and are stuck in a costing debate.
We are a high volume manufacturer of fasteners and have traditionally been
standard cost. I would like to receive input as to how adept Vantage is at
standard cost, whether the average costing works well, what to be concerned
with, etc

Thanks

Joe Holloway
Technifast Industries






[Non-text portions of this message have been removed]