To address the issue of using either last cost or average cost for highly variable configured items in Acumatica, which can negatively impact margin calculations, the key is to tie the cost of the item to its specific configuration. In Acumatica, there is a built-in Configurator module for calculating prices based on the configuration, but the cost behavior is limited when it comes to cost calculations.

Here are potential approaches to better manage costs for configured items based on their configuration:

1. Utilize Acumatica’s Configurator for Cost Calculation:

• Acumatica’s Configurator module allows you to define rules and attributes for building a unique configuration of an item. This can be leveraged not only for pricing but also for costing.
• You would need to create rules that estimate direct and indirect costs based on the configuration options selected. For example, labor, material, or machine time can all be configured to feed into the overall cost calculation.

How to Implement:

• In the Manufacturing Edition, go to Manufacturing → Configuration → Configuration Maintenance and define the rules for costs based on the configuration (e.g., materials, production processes, overhead).
• Use the Cost Roll process to calculate the cost based on the current configuration, similar to how you use it for pricing.

2. Custom Cost Calculation Logic for Configurations:

• If the default configurator functionality doesn’t fully meet your needs, you may need to implement a custom cost calculation method that aligns with the specific attributes of your configured items.
• This would involve creating custom fields or a business logic that calculates the item cost based on the specific configuration parameters and writes the result to the SOLine.Cost field.

How to Implement:

• Use Customization Projects in Acumatica to create a custom calculation logic that ties into the Sales Order or Inventory modules.
• The logic would take the selected configuration (e.g., BOM, attributes, options) and calculate the specific cost for that configuration, similar to the way pricing is determined for configured items.

3. **Leverage the BOM (Bill of Materials) for Configured Items Costing:

• Each configuration of a highly variable item can be treated as its own BOM with a unique set of components, materials, and labor costs. This approach allows you to generate an accurate cost for the specific configuration of the item.
• Acumatica can then use the BOM cost in SOLine.Cost to improve margin accuracy for each configuration.

How to Implement:

• For each configured item, create a dynamic BOM (or a BOM specific to the configuration) in the Manufacturing module.
• The BOM will generate the actual cost of the configured item based on its materials, labor, and overhead.
• In the Sales Order screen, the system can be configured to pull in this BOM-specific cost when the sales line item is generated.

4. Use of Import Scenarios and Business Events:

• You could also automate cost updates based on configuration through import scenarios or business events.
• After a configuration is selected, an import scenario or a business event could trigger a recalculation of costs based on predefined rules.

How to Implement:

• Create an import scenario that pulls in the necessary configuration details and recalculates the cost using a specific calculation formula.
• Set up a business event to trigger when a new configured sales order line is added, which will calculate and update the cost based on the selected configuration.

5. Switch to Standard Costing for Specific Items:

• For highly configurable items, you could switch to standard costing rather than using average cost or last cost and use a periodic update process that recalculates costs based on the configuration.
• Standard costing allows you to have more control over the cost updates.

How to Implement:

• Go to the item’s valuation method in Inventory and set it to Standard Costing.
• Create a process (either manual or automated using import scenarios) to update the standard cost based on configuration whenever a new configuration is created or a new sales order is placed.

6. Post-Sales Order Adjustments:

• If the actual cost calculation needs to happen after the sales order is placed (e.g., once the item is manufactured based on the specific configuration), you could use an adjustment process to correct the SOLine.Cost based on the final manufacturing cost.
• This would require integrating the sales and manufacturing modules to reflect the actual cost once the production is complete.

How to Implement:

• Set up a workflow that adjusts the cost after production is completed, ensuring the sales order reflects the true cost of the specific configuration before invoicing or final margin calculation.

Conclusion:

To achieve better cost calculation for configured items in Acumatica, you can:

• Utilize the Configurator module for cost calculation rules.
• Implement custom logic or dynamic BOMs to calculate specific configuration costs.
• Leverage import scenarios and business events to automate cost recalculations.
• Consider switching to standard costing for more control over cost updates.

Each approach allows for more accurate margin calculations by ensuring the cost reflects the exact configuration of the item, rather than relying on average or last cost. The ideal solution depends on the complexity of your configurations and manufacturing processes.

Thanks for the detailed response @chameera71 

I am glad we are not the only ones who are struggling with this. I thought I was crazy when I looked through the community and couldn’t find anybody else who was having this issue!  I feel like there is a lot that can be done with the configurator but there are some very simple things that would be making it easier to manage. When I have time, I was planning on getting a thread going for some ideas that I have….

• In the Manufacturing Edition, go to Manufacturing → Configuration → Configuration Maintenance and define the rules for costs based on the configuration (e.g., materials, production processes, overhead).

@chameera71 I would like to know more about how to do this. I don’t see anything regarding rules for cost based on the product’s configuration. That is exactly what we are trying to do, but I don’t see any cost information in the configurator.

That is part of what the customization is doing. Unless I am understanding incorrectly, @chameera71  is providing the customization workflow.