Production Cost: Labour and Scrap
When you make goods from a recipe, their cost is the raw material used plus the labour and running costs of making them, less any scrap you can sell. Put a "Labour & Overheads per Batch" figure on the recipe, or type the amount for one production. That amount moves from expenses into stock until the goods are sold. Saleable scrap comes into stock at its value, ready to sell on an ordinary bill. Raw materials also appear on sale bills, marked Raw Material. Ask your CA which costs to include.
- Open the finished item → Kit / Recipe and fill Labour & Overheads per Batch.
- Open Stock → Production, pick the item and quantity; type a different labour figure only if this batch cost more or less.
- Under Scrap or By-Product You Can Sell, add what came out and its value per unit, then Make.
- Where the floor used more or less than the recipe, open Material Actually Used and type it; Reports → Production Cost shows the difference.