Bill of Materials

1. Bill of Materials Objective At the end of this course, you will be able to define the different types of bills of materials and use them

2. 2007 – Bill of Materials Please review the following terminology changes that apply in SAP Business One 2007:

3. Production & Bill of Materials • The Production module supports production processes, starting from the bill of materials definition to the issue and the completion of the Production Order • A Bill of Materials (BOM) in SAP Business One is a combination of several components that form a single parent item • Effect of production processes on the stock valuation is detailed in a separate lesson

4. Bill of Materials Types • It is possible to define 4 types of bills of materials: Sales, Assembly, Production and Template • Sales - The parent item is composed of its child items only when the parent item is actually sold • Assembly – Only the parent item appears in Sales documents • Template – A “flexible” bill of materials • Production – The parent item (the final product) is produced from its child items (the raw materials) using the Production Order window • Note! The work method with the first 3 types will be explained at the end of this lesson

5. Initial Definitions 1 • 1. Item Master Data • Inventory  Item Master Data  General tab:

6. Initial Definitions 2 • 2.Defining Bills of Materials • Production  Define Bill of Materials:

7. Labor Items in a Production BOM • To add additional costs, such as Labor, to a Production Order, include non-inventory items in the bill of materials • The Issue Method of such items should be Backflush • The total amount of the non-inventory items in the bill of materials is displayed in the Production Order on the Summary tab, in the Actual Additional Cost field • These costs will be reflected in the journal entry created by the Receipt from Production and will affect the parent item’s cost

8. Working with Sales & Assembly Bills of Materials • For a Sales bill of materials, determine whether the price of the parent item or child items will appear in Sales documents • Determine the display mode via Administration  System Initialization  Document Settings  General tab, and select the required option: • “When Splitting a Sales BOM in Documents Show:” • Price and Total for Parent Item Only Or • Price for Child Items that Comprise • Changing the Parent quantity in the Sales document changes the child item quantities accordingly • Note! The item’s price is determined by the customer’s price list and not by the BOM definition

9. Demo – Sales and Assembly

10. Working with a Template Bill of Materials • When selecting a template bill of materials in a document, all its child items are displayed in the document • You can change the prices for both the parent and child items, and add or delete items from the document as desired

11. Demo – Template Bill of Materials

12. Test Your Knowledge

13. Bill of Materials: Course Summary The course explained how to • define the different types of bills of materials and use them