Once you have captured all the time, stock usage and/or purchase order that it took to build your output product, the most important part of the process is to complete the production job. The completion process will complete the production job, stock adjust the output product(s) into stock with the unit cost determined by the actual cost of the project divided by the output quantity. You will also have the option of capitalising your labour cost to SoH in Xero or not.
Whether to do this or not will affect your P&L and which option best suits your accounting requirements should be discussed with your accountant. Capitalising labour will include the cost of the labour added to the production job in the unit cost of the output products.
It is important to only complete your production jobs when you are 100% sure you have tracked all your production costs. Additional costs cannot be added in later after the output product is moved into stock.
To complete your production jobs:
- Open the production job from the production job dashboard.
- Confirm you have finalised all your actuals correctly - Timesheets, task progress, stock usage and purchase orders. You can confirm this via the widgets and the Time, Materials and Purchases tabs.
- Click Complete Production Job from the production job's quick actions menu.
- Confirm and enter the actual quantity produced
- Decide if you want to capitalise your labour costs
- Confirm you are 100% sure you've included everything!
- The production job is now complete and can be accessed via the See Completed Production Jobs from the production jobs dashboard's quick actions button.
- The completed production job will create a stock movement to move the output lines into stock. The unit cost is determined by the actual cost of the project divided by the output quantity. It is also dependant if labour is capitalised or not.