This is usually the area where most manufacturers fail in achieving profitability as they struggle to match the two processes of production and accounting for its cost. This is exactly what x2x Lite Manufacturing was designed to do for companies utilizing QuickBooks Online. The central feature of this application is Production Order Management. It involves converting the raw materials into products and accounting for every cent spent during the process. It is important to learn how to manage the production orders using this application.
The Creation Phase: Combining Flexibility and Structure
Our journey starts at the Create Production module. This module is where we blend the power of automation and the dynamics of the shop floor. Once you choose the product that needs to be manufactured, the system automatically generates the Bill of Materials (BOM) for it. There’s no need for manual searching for each bolt or screw. The BOM automatically populates the required components along with their quantity and cost.
But what if something happens on the shop floor? What if you lack a certain component and need to replace it or must manufacture a custom batch of the same product but with a few changes? In x2x Lite Manufacturing, you can customize the BOM for that production order.
Workflow Management: Unposted vs. Posted
Once you generate a manufacturing order, x2x Lite Manufacturing will ensure that its workflow is managed using different states that protect your data.
Unposted Manufacturing Order: As a safety feature, some transactions may not post to QuickBooks due to synchronization issues and lack of data among others. The x2x Lite Manufacturing stores such information in the unposted section for 15 days to prevent information loss. This give an administrator time to rectify the mistake and repost the order without creating it from scratch.
Posted Manufacturing Orders: Any manufacturing order that succeeds in being posted will appear on this section. Data in this area is read-only and will automatically transfers to QuickBooks. It becomes a record of all the finished goods of company.
The Accounting Engine: Clearing Accounts and Reconciliation
What really makes x2x Lite Manufacturing different from other solutions is its approach to handling finances. As soon as the production order gets set up, x2x Lite will generate accounting entries behind the scenes. For this purpose, its uses a Clearing, self-balancing account. Define the Clearing Account in Preferences.
With the help of the Clearing Account, the system can make sure the value of production items (component costs, labour, and overhead) is calculated correctly. Also, the item adds to the inventory with the right cost value. Once the production process ends, the values in the clearing account become balanced.
As a result, you don’t need to manually balance your Inventory Asset account in QuickBooks to make sure that all the items in the inventory are at the right value. Moreover, with the help of the Accounts Reconciliation page, you can see any discrepancies between the production costs in x2x and QuickBooks.
Conclusion
The concept of Production Order Management in x2x Lite Manufacturing involves more than just monitoring productivity; rather, it entails building an integrated circuit from the manufacturing shop to the office. With automatic BOM generation, provision for transaction errors, and advanced cost calculations via the Clearing Account feature, x2x provides manufacturers with the capacity to grow without limits. x2x guarantees production management while keeping QuickBooks Online accounting updated.
