Calculate unit cost per title from actual and direct costs put through the system. The Job costing module, when activated, records the various costs of the book, as entered in the actual supplier invoices and credit notes put through in the purchase ledger. It also captures direct costs i.e. in-house or already-paid-for costs.

The Job costing module enables you to

• Post costs from Purchase Ledger
• Post Direct Transactions
• Calculate unit costs based on
  • Weighted Average
  • Last Cost
  • Current Inventory
• Manage Job Profile / Enquiry
• Post Cost of sales

Post costs from Purchase Ledger

As you enter purchase invoices and credit notes, Focus posts to the purchase ledger, as well as posts to the job costing module, if you specify the stock code, quantity and cost code; thereby assembling all the costs involved in the production of a title.

1. Go to Accounts> Purchase Ledger > Invoices to enter purchase invoices. Or go to Accounts > Purchase Ledger > Cre Note to enter purchase credit notes
2. Ensure that on the purchase invoice / credit you have specified the stock code, quantity and cost code.
3. Click Save to finish the invoice / credit

Post Direct Transactions

Manual transactions or Indirect Costs can also be entered directly into the job costing module. These are usually internal costs which are already paid for, such as salaries, paper etc. These costs can be entered as charges against a title to be reflected in the unit costs calculation. To enter direct Job Cost Transactions

1. Go to Publishing> Job Costing > Direct Trans
2. Select a stock code
3. Select a cost code in the Cost Code box
4. Enter the units and rate
5. Click Save

Calculate unit costs

The procedure to calculate unit cost depends on your choice of the unit cost method. Focus enables you to apply one of three methods of unit cost.

• Weighted Average
• Last Cost
• Current Inventory

Always run the unit cost calculation routine right before you take a valuation report of your stock or at the end of a financial period, because it refreshes all the stock unit costs by incorporating all new invoices entered since the last run.

Calculating Unit Costs – Weighted Average Method

Unit cost is calculated on the basis of the formular  where

• Total Life Value= Unit Cost is calculated using the total value of all job transactions, for the life of the book, for which the unit cost code is marked as ‘Included in the Unit Cost calculation’
• Total Life Quantity= Total quantity per print run is calculated from all job transactions, for the life of the book, for which the unit cost codes are marked as ‘Print Cost Code’.

To calculate unit cost

1. Select Publishing> Job Costing > Calculate Unit Costs
2. Click Begin Calculations

Calculating Unit Costs – Last Cost Method

To calculate unit cost based on only the last costs

1. Select Publishing > Job Costing > Profile
2. Select a stock code
3. Then click the Calculate Cost button to manually close-off unit cost per title

NOTE

• This is done on a title-by-title basis.
• By using a system of Active and Closed Job Transactions to determine Last Print Costs, this option allows you to determine when all the relevant costs have arrived and to trigger a unit cost calculation.
• Once the Last Cost option is triggered, as shown above, the new unit cost will be based on the active-job-transactions only.
• You will be required to confirm the new unit cost figure before it is committed to the database. Focus will write the new unit cost, and then mark all relevant transactions as closed.
• Thereafter the new/active costs can then be collected as Active, and will be used in the next unit cost calculation.
• Note that for existing stock this means that unit cost calculation is derived from reprints and that origination costs, for instance, are effectively written off.
• Due largely to significant differences in prices over time, the trend has been to opt for alternative methods of calculating unit cost based on last cost, away from the weighted average method.

Calculating Unit Costs – Current Inventory Method

This method calculates unit cost per title, based on the current inventory. It adds the closing stock value for last year (same as opening stock value for current year) weighted by the closing quantity for last year (same as opening stock quantity for current year), to the current year purchases value, weighted by the current year purchases quantity. Unit cost is calculated on the basis of the formula  where

• Opening value= last year closing value, held in the “Stock_Rec.LastYearClosingAmount” field, as updated at year end.
• Purchases Value= total value of curent year purchases, derived from invoices put through to Job_Trans table
• Opening Quantity= last year closing quantity, held in the “Stock_Rec.LastYearClosingQuantity” field, as updated at year end.
• Purchases Quantity= total quantity of curent year purchases, derived from invoices put through to Job_Trans table, where the unit cost codes are marked as ‘Print Cost Code’.

To calculate unit cost

1. Select Publishing> Job Costing > Calculate Unit Costs
2. Click Begin Calculations

Settings

Before you calculate unit cost per title from actual and direct costs put through the system, you have to do the following.

• Activate Job Costing
• Select Unit Cost Method
• Define Job Categories
• Define Cost Codes

Activate Job Costing

Before you can use the Job Costing module, you have to switch it on by allowing the input of job cost codes on purchase ledger invoices and credit notes

1. Go to Maintenance> Preferences
2. Select Other Preferences
3. Expand Purchase Ledger> Section One
4. Tick the “Allow the input of job cost codes on invoices and credit notes” box
5. Click the Savebutton

Select Unit Cost Method

Focus allows you to calculate unit cost using one of three methods

• Weighted Average
• Last Cost
• Current Inventory

To select a unit cost method

1. Go to Maintenance> Preferences
2. Select Other Preferences
3. Expand Stock Ledger> Section Three
4. In the “For Unit Cost Calculations, Use” box select a unit cost method
5. Click the Savebutton

Define Job Categories

A job category defines a group of related cost headings (codes). Focus supports up to nine (9) job categories (cost groupings). To setup Job Categories

1. Go to Publishing> Job Costing > Categories
2. Enter the cost group heads under “Category Description“. All entries are auto-saved.
3. Close the window

Define Cost Codes

A cost code belongs to a job category. A cost code is used to accumulate costs of a particular definition. The definition and setup of the cost code affect the way it impacts the calculation of the unit cost To setup Job Cost Codes

1. Go to Publishing> Job Costing > Cost Codes
2. Select “Click here to add a new line” to add a new cost code, then press Enter.
3. Enter a Description
4. Select a Category for this cost code
5. Enter a Nominal Code
6. Enter a Unit Rate
7. Tick/Untick “Include in cost”: Unit Cost is calculated using the total value of all the job transaction for which the unit cost code is marked as ‘Include in Cost’
8. Tick/Untick “Is for Printing”: Total quantity per print run is calculated from all job transactions where the unit cost codes are marked as ‘Print Cost Code’.
9. Tick/Untick “Is an Expense”
10. Tick/Untick “Charge per Book”
11. Click the Save button