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Manufacturing module

Turning raw materials into finished goods at a computed rather than an estimated cost: a bill of materials per product, a production order that issues materials from the warehouse and receives the finished item, and an actual cost built on the weighted average of the materials consumed plus applied overheads — all with automatic stock and journal entries.

Before you start: manufacturing accounts

Purpose: the module is linked to the chart of accounts from Settings → Accounts. These accounts are what turn a production order into a correct journal entry rather than a silent stock movement.

Setting	Used for
Raw material inventory	Credited with the value of materials consumed on issue.
Finished goods inventory	Debited with the cost of the produced item on closing.
Applied manufacturing overheads	Labour and running costs added to the order cost.
Work in progress	The interim account holding cost between opening and closing the order.

ℹ️ Manufacturing rides Inventory: materials and finished goods are ordinary inventory items with their units and warehouses — no duplicate definitions.

Bills of materials (BOM)

Path: Manufacturing → Bills of materials — /manufacturing/boms

Purpose: the product recipe — what it takes to produce a standard quantity. Defined once and used by every later production order.

Field	Description
Finished item	The resulting product — an inventory item.
Standard quantity	The quantity this recipe produces (say 100 units); component quantities relate to it.
Component lines	Materials with quantities and units per standard quantity.
Active	An inactive recipe disappears from production-order pickers without losing its history.

💡 Wastage: if your product has habitual wastage, build it into the component quantities so the cost reflects reality rather than the ideal.

Production orders

Path: Manufacturing → Production orders — /manufacturing/production-orders

Purpose: the execution document. Pick the product and quantity and its components are pulled from the recipe, still editable (a material may be substituted for one order). An order has three states: draft, then in progress, then closed.

Stage	What happens
Draft	Quantities and components are freely editable; no stock or accounting effect yet.
Execution (issue)	Materials are drawn from the warehouse at actual cost (weighted average); the system refuses the issue when stock is short.
Applied costs	Labour and running costs added to the order before closing.
Closing	The finished item enters the warehouse at cost = materials consumed + applied costs ÷ quantity produced.
Cancellation	Reverses the movements with counter entries rather than erasing them.

⚠️ Cost is actual, not standard: the unit cost is computed from the average material cost at issue time, so two orders for the same product differ when purchase prices moved — which is the accounting truth.

ℹ️ Numbering: production orders have their own counter with the PRD- prefix, managed from the counters screen.