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Project Costing Based on Material Issuance (Consumption-Based Costing)

in Project Management 5 comments

Hi All,

Greetings of the day…!

We have a business requirement related to Project Costing for a Construction-based business where materials like cement bags are procured and stored, and only the materials issued to the project are to be considered as project costs.

Actual process in Projects:

  1. A Project is created → PJC_1
  2. A Purchase Requisition (PR) is raised against the project → PRC_1 for $500✅ Cost reflected in Project as Purchase Requisition Committed Cost = $500
  3. A Purchase Order (PO) is created from the PR for $500✅ Cost moved to PO Committed Cost = $500❌ PR Committed Cost = $0
  4. Material is received against the PO for $500✅ Committed Costs cleared✅ Receipt & Cost Accounting processed✅ Cost imported to Project →
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