Production costs and costing

Fiddle calculates what it costs to make a product by rolling up its BOM. Knowing how the roll-up works keeps your margins and inventory valuation accurate.

What goes into the build cost

Cost type	Source
Material	Each component’s quantity × its unit cost
Sub-assembly	The rolled-up cost of any made components
Labor	Time or rate entered on the BOM
Overhead	Fixed or percentage cost applied to the build

The product’s total build cost is the sum of all four, divided by the output quantity to give a cost per unit.

How the roll-up works

1. Component costs come from each item’s current unit cost.
2. Sub-assembly costs are calculated from their BOMs first, then bubble up.
3. Labor and overhead are added on top.
4. The total is divided by the build quantity.

Costs are recalculated when component costs change, so the build cost always reflects current pricing.

Expected vs. actual

A BOM gives the expected cost. When you complete a work order, Fiddle records the actual cost from the quantities you really issued. Comparing the two surfaces waste, price drift, or yield problems.

Add a wastage percentage in the master BOM editor so expected costs include material you know you’ll lose.

Next steps

Review costs in context when you create a work order.