Re: Material overhead

we used to have what we called 'material burden'. we set up a cost bucket for 
this and coded it as a 'material' cost (as opposed to labor or burden). we 
entered the material cost standard into its own cost bucket. we wrote a very 
simple program that ran before the cost roll up. this program looked at the 
material cost standard in bucket 1 and calculated the material burden cost 
standard to be 9% of the material standard. it put the calculated material 
burden in its own cost bucket and updated cost bucket zero by the amount of the 
calculated material burden. we then let bpcs roll up the costs. this served our 
purposes. the rational was that the 9% burden was to cover the cost of 
purchasing, receiving, etc. we have since ceased this practice for other 
reasons, but bpcs handled it just fine.

chick doe
barton instrument systems

>>> harrynicholl@hotmail.com 07/21/01 07:10PM >>>
AS/400 v6.1.01

Does anyone have any experience using material rather than labor overhead?

Any comments on use in setting up and using in standard and actual costing 
would be appreciated.

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