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PRODUCTION CONTROL – PART #1

Overview of series – Learning discrete manufacturing and understanding costing by setting up scenarios in dynamics 365.

Overview of this document – Here we are only discussing the production scenario which we will be testing in the ERP system.

Scenario………………………………………………………………………………………………………. 1

  1. ABC Gaming Laptop Production Scenario with Two Variants……………………………………………. 1

 

  1. ABC GAMING LAPTOP PRODUCTION SCENARIO WITH TWO VARIANTS

ABC Gaming Laptop product master has only two variants based on: –

 

  • size,
  • color,
  • configuration (16GB or 32GB RAM), Variants: –
  • Variant 1: 14″, Silver, 16GB
  • Variant 2: 6″, Black, 32GB

These variants maintain the ABC Gaming Laptop context, with slight changes to:

  • BOM: Adjusted for size (display panel, chassis) and RAM configuration, with color-specific chassis coating.
  • Route Operations: Include size-specific display attachment and color-specific chassis finishing, as in the previous
  • Indirect Costs: Slightly increased to account for variant management, but kept
  • Costing will use the existing rates (labor and robotic at $10/hour) with the “Setup C Run Cost per Operation”

 

Product Master: ABC Gaming Laptop Variants

 The ABC Gaming Laptop is a high-performance gaming laptop with the following base specifications:

  • Processor: AMD Ryzen 7 5800H (8 cores, 16 threads, up to 4 GHz)
  • Storage: 512GB NVMe SSD
  • Graphics: NVIDIA GeForce RTX 3060 (6GB GDDR6)
  • Keyboard: RGB backlit with anti-ghosting
  • Battery: 48Wh Li-ion, up to 6 hours
  • Connectivity: Wi-Fi 6, Bluetooth 5.0
  • Operating System: Windows 11 Home (pre-installed)

Variant Options

 The product master defines two variants:

·  Variant 1 – ABC Gaming Laptop (14″, Silver, 16GB):

  • Size: 14″ Full HD (1920×1080) IPS, 144Hz
  • Color: Silver
  • RAM: 16GB DDR4 (2 x 8GB, 3200 MHz)
  • SKU Code: ABC-14-SIL-16

·   Variant 2 – ABC Gaming Laptop (15.6″, Black, 32GB):

  • Size: 6″ Full HD (1920×1080) IPS, 144Hz
  • Color: Black
  • RAM: 32GB DDR4 (2 x 16GB, 3200 MHz)
  • SKU Code: ABC-15-BLK-32

Bill of Materials (BOM) with Costing

 BOM for ABC Gaming Laptop (14″, Silver, 16GB)

Component Quantity Unit Cost ($) Total Cost ($) Description
Motherboard 1 150.00 150.00 With AMD Ryzen 7 5800H and RTX 3060
RAM Module 2 30.00 60.00 8GB DDR4 3200 MHz (16GB total)
SSD Storage 1 80.00 80.00 512GB NVMe SSD
Display Panel 1 G0.00 G0.00 14″ FHD IPS, 144Hz
Keyboard Assembly 1 40.00 40.00 RGB backlit, anti-ghosting
Battery Pack 1 60.00 60.00 48Wh Li-ion battery
Chassis (Top, Silver) 1 48.00 48.00 Aluminium top cover, silver coating
Chassis (Bottom, Silver) 1 43.00 43.00 Aluminium base, silver coating

 

Cooling Fan 1 15.00 15.00 Thermal management fan
Heat Sink 1 20.00 20.00 Copper heat sink for CPU/GPU
Webcam Module 1 10.00 10.00 720p HD camera with microphone
Speakers 2 5.00 10.00 Stereo speakers
Wi-Fi/Bluetooth Module 1 25.00 25.00 Wi-Fi 6, Bluetooth 5.0
Power Adapter 1 30.00 30.00 65W USB-C charger
Screws and Fasteners 20 0.10 2.00 Various sizes for assembly
Thermal Paste 1g 2.00 2.00 For CPU/GPU thermal interface
Total BOM Cost 645.00

BOM for ABC Gaming Laptop (15.6″, Black, 32GB)

Component Quantity Unit Cost ($) Total Cost ($) Description
Motherboard 1 150.00 150.00 With AMD Ryzen 7 5800H and RTX 3060
RAM Module 2 55.00 110.00 16GB DDR4 3200 MHz (32GB total)
SSD Storage 1 80.00 80.00 512GB NVMe SSD
Display Panel 1 100.00 100.00 15.6″ FHD IPS, 144Hz
Keyboard Assembly 1 40.00 40.00 RGB backlit, anti-ghosting
Battery Pack 1 60.00 60.00 48Wh Li-ion battery
Chassis (Top, Black) 1 50.00 50.00 Aluminium top cover, black coating
Chassis (Bottom, Black) 1 45.00 45.00 Aluminium base, black coating
Cooling Fan 1 15.00 15.00 Thermal management fan
Heat Sink 1 20.00 20.00 Copper heat sink for CPU/GPU
Webcam Module 1 10.00 10.00 720p HD camera with microphone

 

Speakers 2 5.00 10.00 Stereo speakers
Wi-Fi/Bluetooth Module 1 25.00 25.00 Wi-Fi 6, Bluetooth 5.0
Power Adapter 1 30.00 30.00 65W USB-C charger
Screws and Fasteners 20 0.10 2.00 Various sizes for assembly
Thermal Paste 1g 2.00 2.00 For CPU/GPU thermal interface
Total BOM Cost 70G.00

BOM Notes

  • Size:
    • 14″ (Variant 1): Smaller display ($90 $100) and lighter chassis ($48/$43 vs. $50/$45) reduce costs.
    • 6″ (Variant 2): Larger display and chassis increase costs.

·  Color:

  • Silver (Variant 1): Slightly lower chassis cost due to simpler coating ($48/$43).
  • Black (Variant 2): Higher chassis cost due to premium coating ($50/$45).

·  Configuration:

  • 16GB (Variant 1): 2 x 8GB DDR4 ($30 each, $60 total).
  • 32GB (Variant 2): 2 x 16GB DDR4 ($55 each, $110 total).

Route Operations with Costing, Batch Sizes, and Resources

 The assembly process is nearly identical for both variants, with minor changes:

  • Display Panel Attachment: Adjusted run time for 14″ 15.6″ displays.
  • Chassis Finishing: Color-specific coating (Silver or Black). Rates: labor and robotic operations both at

$10/hour. The table includes the “Setup C Run Cost per Operation” column.

Operation Type Resource Batc h Size Setu p Time (hr) Run Time (hr/uni t) Setup s Run Cost per Operatio n ($) Setup Cost ($/uni t) Run Cost ($/uni t) Total Cost ($/uni t) Applie s To
Motherboa rd Preparatio n Roboti c ThermalBot

-1

 200 0.50 0.033 Setup: 5.00,

Run: 0.33

 0.025 0.33 0.36 Both

 

Componen t Installation Manua l Technician Team A 50 1.00 0.083 Setup: 10.00,

Run: 0.83

 0.20 0.83 1.03 Both
Chassis Base Assembly Roboti c AssemblyB ot-2 150 0.75 0.05 Setup: 7.50,

Run: 0.50

 0.05 0.50 0.55 Both
Cooling Fan and Battery Installation Manua l Technician Team B 100 1.00 0.067 Setup: 10.00,

Run: 0.67

 0.10 0.67 0.77 Both
Display Panel Attachme nt (14″) Roboti c DisplayBot

–3

 200 0.50 0.033 Setup: 5.00,

Run: 0.33

 0.025 0.33 0.36 Varian t 1
Display Panel Attachme nt (15.6″) Roboti c DisplayBot

–3

 200 0.50 0.05 Setup: 5.00,

Run: 0.50

 0.025 0.50 0.53 Varian t 2
Keyboard and Webcam Installation Manua l Technician Team C 50 1.00 0.083 Setup: 10.00,

Run: 0.83

 0.20 0.83 1.03 Both
Chassis Finishing (Silver) Roboti c CoatingBot

–6

 100 0.50 0.017 Setup: 5.00,

Run: 0.17

 0.05 0.17 0.22 Varian t 1
Chassis Finishing (Black) Roboti c CoatingBot

–6

 100 0.50 0.025 Setup: 5.00,

Run: 0.25

 0.05 0.25 0.30 Varian t 2
Final Assembly Roboti c AssemblyB ot-4 150 0.75 0.05 Setup: 7.50,

Run: 0.50

 0.05 0.50 0.55 Both

 

Quality Assurance and Testing Manua l QA Team 25 2.00 0.167 Setup: 20.00,

Run: 1.67

 0.80 1.67 2.47 Both
Packaging Mixed PackBot-5 C Pack Team 100 1.00 0.05 Setup: 10.00,

Run: 0.50

 0.10 0.50 0.60 Both

Total Operation Costs

  • Variant 1 (14″, Silver, 16GB): $7.94 (uses Display Panel Attachment 14″ at $0.36 and Chassis Finishing Silver at $0.22)
  • Variant 2 (15.6″, Black, 32GB): $8.19 (uses Display Panel Attachment 6″ at $0.53 and Chassis Finishing Black at $0.30)

Indirect Costs

 Suppose we have only these two products produced and we have following indirect costs. Indirect costs are allocated per unit based on a production run of 100 units, with a slight increase for variant management.

Indirect Cost Item Total Cost ($) Cost per Unit ($) Description
Facility Rent 1,000.00 10.00 Monthly rent allocation
Utilities 500.00 5.00 Electricity, water, internet
Equipment Depreciation 800.00 8.00 Amortized cost of robotic arms, tools
Quality Control Software 200.00 2.00 Licensing for diagnostic tools
Worker Training 300.00 3.00 Ongoing training programs
Administrative Overhead 425.00 4.25 Management, HR, accounting, SKU tracking
Total Indirect Cost 3,225.00 32.25

Cost Calculation Notes

  • Setup s Run Cost per Operation:
    • Setup Cost per Operation: Setup Time × E.g., Motherboard Preparation: 0.5 × 10 = $5.00.
  • Run Cost per Operation: Run Time × Rate (per unit). g., Component Installation: 0.083 × 10 =

$0.83/unit.

  • Setup Cost per Unit: Setup Cost per Operation ÷ Batch E.g., Component Installation: 10 ÷ 50 =

$0.20/unit.

  • Run Cost per Unit: Same as Run Cost per E.g., Component Installation: $0.83/unit.
  • Total Cost per Unit: Setup Cost ($/unit) + Run Cost ($/unit).
  • Packaging: Mixed operation uses $10/hour

·         Operation Changes:

  • Display Panel Attachment: 14″ displays require less time (0.033 hr/unit 0.05 hr/unit), reducing costs ($0.36 vs. $0.53).
  • Chassis Finishing: Silver coating is faster (0.017 hr/unit, $0.22) than Black (0.025 hr/unit, $0.30) due to premium finish.
  • Batch Size: Robotic operations (e.g., Motherboard Preparation) use larger batches (200); manual QA uses smaller batches (25).
  • Resources: CoatingBot-6 for chassis finishing; other resources
  • Rates: Labor and robotic operations both at $10/hour.

Indirect Cost Notes

  • Applicability: Same indirect costs apply to both

 

Total Cost Summary Variant 1: 14″, Silver, 16GB

Cost Category Cost per Unit ($)
BOM Cost 645.00
Operation Cost 7.94
Indirect Cost 32.25
Total Cost 685.1G

 Variant 2: 15.6″, Black, 32GB

 

Cost Category Cost per Unit ($)
BOM Cost 709.00
Operation Cost 8.19

 

Indirect Cost 32.25
Total Cost 74G.44