A small factory runs on a loop: a customer orders, you buy what is short, you make it, you check it, you ship it, and at the end of the month you want to know what each unit really cost. TamilAccounting keeps that whole loop in one set of books, so the purchase, the production, the inspection and the invoice are the same records rather than four spreadsheets.
Who it suits
- Engineering and fabrication shops: machined parts, fabricated structures, builds in stages across work centres
- Food processing: recipes with a wastage allowance, batch and expiry on the output
- Assembly units: kits, panels and products built from bought-in parts
- Small factories that send work out: plating, painting or machining done by a job worker
The problems it solves
- Nobody knows what a unit actually cost, only what it was supposed to cost
- Material short on the day production starts
- Stock sent to a job worker vanishes from the books until it comes back
- Rejects and machine stoppages that nobody can explain at month end
- Freight and customs on raw material that never reach the item's cost
A month in the factory, screen by screen
1. The order
A confirmed Sales Order containing manufactured items can raise a work order straight from the order or from any line still to be delivered, so production stays linked to the customer.
2. Buying what is short
Each item carries a Re-Order Level and Reorder Quantity per location, with a preferred supplier. Switch on Auto Requisition Level and items that reach their reorder level land in a purchase requisition. The Material Shortage report sets what open work orders need against stock on hand and open purchase orders. Material is then bought through the normal Purchase Order, receipt and supplier invoice.
3. Landing the true material cost
With the Landed Cost app switched on, open the supplier invoice and choose Landed Cost. Enter Shipping, Insurance, Customs, Processing and Other Charges, split them across the lines by amount or by quantity, and the item's cost is recalculated with those charges included.
4. Making it
Every item you make has a bill of materials with a wastage % per line. A Work Order is one of three types: Assemble (done on save), Unassemble (the reverse), or Advanced Manufacture, where you release the order, produce in runs, issue extra material, add labour and overhead, and close. Job cards schedule operations by work centre and team, with target and actual quantity and hours. Rejects are recorded on each run against reasons, and stoppages are logged as Downtime.
5. Work sent out
Mark a supplier as a job worker and they get their own stock location. A work order set to subcontract sends material on a challan, receives the finished goods back with the job worker's charges, and the job worker's bill is matched against what actually returned.
6. Checking it
The Quality Control app adds inspections to purchase receipts (Purchases › Incoming QC) and to production runs and job work receipts (Manufacturing › Quality): the checks set in an inspection plan, each reading taken, and a pass, fail or hold. Failures can raise a non-conformance report and a corrective action, and a Certificate of Analysis prints from the inspection.
7. Shipping and closing the cost
The goods are delivered and invoiced from the same sales order. Closing the work order settles whatever is left in work in progress onto the finished goods, and Settle WIP catches orders closed before a late bill arrived.
Worked example: 200 pump housings
Invented business: Kaveri Precision Works. A customer orders 200 pump housings. Castings and bearings worth ₹80,000 are bought; painting goes to a job worker. Tax is left out to keep the figures clear.
| Step | Debit | Credit | Amount |
|---|---|---|---|
| Castings and bearings received and billed | Raw material inventory | Supplier | ₹80,000 |
| Production runs draw the components | Work in progress | Raw material inventory | ₹80,000 |
| Good output into stock | Finished goods inventory | Work in progress | ₹80,000 |
| Labour charged to the order | Work in progress | Labour account | ₹10,000 |
| Overhead charged to the order | Work in progress | Overhead account | ₹6,000 |
| Painting charges on the job work receipt | Work in progress | Job worker (accrued) | ₹4,000 |
| Close: remaining cost onto the item | Finished goods inventory | Work in progress | ₹20,000 |
Work in progress ends at zero and the 200 housings sit in stock at ₹1,00,000, which is ₹500 each. Sold at ₹650, the invoice shows a margin of ₹150 a unit that is based on what the job really cost.
Reports the owner reads
- Work Order Costing: material, labour, overhead and expenses per order, against the standard
- Material Usage: Plan vs Actual and Rejection and Yield
- Downtime and OEE and Work Centre Load
- WIP Valuation and Material with Job Workers
Getting started
- Set up items with units, reorder levels and a preferred supplier.
- Enter the bills of materials, work centres and standard labour and overhead.
- Mark job workers on their supplier records.
- Switch on the Quality Control and Landed Cost apps if you need them, and set up inspection plans.
- Run one small work order end to end before moving the whole floor.
FAQ
Do I have to use every stage?
No. Assemble finishes a job in one save; use Advanced Manufacture only where production takes time or runs in batches.
Can I track batches and expiry on what I make?
Yes. Advanced Manufacture records batch and expiry on each production run, and Batch Traceability follows a batch forwards to customers and back to its material.
Is stock at a job worker still on my balance sheet?
Yes. It moves to the job worker's own location and stays your asset until it is consumed or returned.
What happens when a supplier bill arrives after I closed the order?
Settle WIP finds orders closed before their cost was final and moves the late cost onto the item.
