Production Variance Report

You're at the tail end of your production process and you've just finalized and closed your production order. Now you're ready to dive into the reports.

- Access Point: To find these reports, including the intriguing variance report, simply head to the summary tab.

Unpacking the Total Variance

- Initial Exploration: Begin by getting an overview with the total variance report.

Understanding the Report's Components 

- Key Columns to Note: As you peruse, you'll spot columns for type, number, and description.

- Deciphering Production Insights: These columns offer a window into various aspects of your production order—like the components you've used up, the resources consumed, and the products you've created. You'll also find mentions of any revaluation journals.

Analyzing Costs in Your Report 

- Decoding the Average Cost: This value is a system-derived figure that's influenced by the costing method your organization prefers, such as the moving average.

- Actual vs. Expected Costs: 

  - The 'total', which tells you the actual cost from the production order.

  - The 'estimated total', offering a glimpse into what you ideally should have spent.

- Spotting Discrepancies: The 'variance' column will catch your eye. It's here that you'll see the difference between your total and estimated costs. If the numbers don't match up, it's often due to overconsumption or underconsumption of resources or components.

Grasping the End Product Revaluation

- The Last Line’s Importance: When you reach the end of the report, the product revaluation stands out. It's essentially the last transaction that gets added when you close the production order.

- Why It Matters: This adjustment ensures that any variances you've spotted get rectified by tweaking the value of the final product. Curious about the specifics? You can dive deeper into this transaction by exploring its journal entry.

The Journal Entries

- Reflecting on Revaluations: As you leaf through the journal, it should echo the revaluation of stock based on various variances and any byproducts from the production.

- Making Sense of the Intermediary Account: All this revaluation happens through a unique account—an intermediary one. 

With this walkthrough, you now have a clear roadmap to navigate the variance report at the close of your production process and understand any linked journal entries. Happy analyzing!