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M2M Advanced Costing Modules
Knowing the exact cost of products is a great advantage, or better, necessity, for manufacturing company. Today, you have a ‘planned-costing’ system – which is good for planning – but you don’t know the exact cost of your products. What you do know is: The costs you get from the system (with a bunch of cost variations) does not give an answer to: How much this product really costs me?
The Problem
It’s not rare that a sales manager, after looking at cost reports, says:
“Guys if we’d use these numbers, we’d be dead long time ago. I know I can sell by ‘this’ price, and we have to produce by ‘this’ costs – that’s clear. Now, what I’d like to know is: what costs we really have, so we can do something about it!”
From time to time, companies send a ‘costing commando’ team into the costs jungle to get the right answers. After some time they return, covered with scars, and usually some results. Well, these results are maybe correct at that time – but they will not last long. Business is not static.
What you really need is an automated system which will give you the exact costing information, without unnecessary effort.
The Solutions
Advanced Costing Modules, ACM in short, is the software product which will assign costs to materials or products – exactly, without variations. When you’ll ask yourself: What's the cost of my product? – You’ll get the exact answer!
ACM uses the information which are already in your system. It just processes them in a way that gives the right answers to your questions:
- What is the exact purchase value of materials? Cost of material? Landed costs?
- What is the exact consumption value of materials?
- What is the exact inventory value of materials?
- What is the exact cost structure of my products? Material? Labor? Cooperation? Overhead? More?
- What is the difference between the exact costs of product and planned costs?
- What happened after I changed the material or technology for this product?
- What is the cost of products produced from different batches of material?
- What is the cost of products produced on different shifts?
- What is the exact profit of product? Within period? At this customer? At this shipment?
ACM Costing Features
- FIFO, WAVG, RAVG, Actual Costing - and new costing formulas can be added
- Product costing algorithms can be adapted to specific production flow
- New cost elements can be defined
- New cost elements' value acquisition methods can be added, e.g: Acquire salary from new-source
- Accounting rules are defined using setup, and complete GL Journal Entry is automatically prepared for GL posting
- Complete company costing setup is presented in generated report - Costing Rule Book Report
Flexible and Easy to Implement
ACM is developed in a way that allows maximum tailoring of the program behavior by setting the control parameters - without programming. To make implementation even easier, the default setups are available to start working immediately. We claim that “Any company in any law environment can use ACM to get the exact costing information and to be compliant with law”.
In M2M we do business in an environment demanding costing methods without variations. From the year 2004 on, we have been successfully supporting our customers with FIFO and Weighted Average, and to be compliant with IFRS IAS-2. After many years of experience with our local customers, we decided in 2009 to make ACM available to global market as an add-on solution for the QAD Enterprise Applications.
We hope you’ll enjoy using it!
M2M, ACM team
