Cost Components and Price Structure
Infor LN uses cost components defined in session ticpr0101m to break down product costs into discrete categories. Each cost component represents a specific cost element such as raw material, direct labor, machine hours, overhead absorption, or subcontracting charges. The cost component structure flows through BOMs and routings, rolling up to a complete standard cost for each manufactured item.
- Define cost components in ticpr0101m for material, labor, machine, subcontracting, overhead, and surcharge categories
- Configure cost component groups to aggregate detailed components into summary categories for management reporting
- Set up surcharge calculations in ticpr0120m to apply overhead rates based on direct cost components or activity measures
- Establish cost price calculation schemes defining the sequence of rollup operations from raw material through finished goods
- Configure standard cost freeze and revaluation schedules aligned with financial period close cycles
Standard Cost Calculation and Rollup
Standard cost rollup in Infor LN processes BOMs and routings to calculate the planned cost of each manufactured item. Session ticpr0201m executes the cost rollup across all production levels, applying material costs from purchase price tables, labor rates from work center definitions, and overhead absorption rates from surcharge configurations. The rollup sequence must respect BOM levels to ensure lower-level components are costed before their parent assemblies.
- Execute multi-level cost rollup through ticpr0201m processing from lowest BOM level to finished goods sequentially
- Configure cost price simulation to model the impact of material price changes or routing modifications before committing
- Set up purchase price variance tracking comparing actual purchase prices against standard material cost components
- Define cost price effectivity dates to support planned cost updates aligned with annual budgeting or quarterly reviews
Variance Analysis and Cost Control
Production variance analysis in Infor LN captures the difference between standard and actual costs across material usage, labor efficiency, overhead absorption, and yield. Variance accounts are configured per cost component, providing detailed visibility into where production costs deviate from plan. Monthly variance analysis enables operations teams to identify cost drivers and implement corrective actions before margins erode.
- Configure variance analysis accounts per cost component to capture material price, usage, rate, and efficiency variances
- Set up production order cost reconciliation to compare standard absorbed costs against actual resource consumption
- Generate variance reports by work center, product group, and production order for targeted cost improvement initiatives
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Infor LN Standard Cost Rollup Calculator
Check a single level standard cost build up: material with scrap, setup spread over lot size, run time, labor, machine and overhead.
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