Skip to main content

Manufacturing costs for products

Navigate manufacturing cost management for products in Katana, enhancing cost accuracy.

Dayvid Lorbiecke avatar
Written by Dayvid Lorbiecke
Updated over 2 weeks ago

Katana helps you track manufacturing costs by calculating actual costs for both ingredients and production operations. This ensures visibility into your Cost of Goods Sold (COGS) and profitability.


Where to see manufacturing costs

Once a sales order (SO) is marked as Done, you can view:

  • Sales Revenue

  • Cost of Goods Sold (COGS based on the average cost)

  • Profit per SO

View this in the Done table of the Sell screen.

Screenshot highlighting the done table on the sell screen


What makes up manufacturing costs?

Manufacturing costs consist of:

Ingredient costs

Screenshot highlighting the cost column for ingredients on an MO

These are pulled from the product’s recipe when a manufacturing order (MO) is created.

  • Cost formula:
    Ingredient Cost = Average Cost × Quantity Used

  • On Open MOs, costs are based on planned quantities.

  • When MO status = Done, costs are recalculated based on actual usage.

Note: If the ingredient’s In stock is 0, the Default purchase price is used as a placeholder. If completed while stock is still zero, the cost used will be 0 (not recommended).

You can also manually:

  • Add or remove ingredients directly in the MO if changes are needed.


Operation costs

Screenshot highlighting the cost column for operations on an MO

These come from the Production Operations tab on a product’s item card.

  • Cost formula:
    Operation Cost = Actual Time × Cost per Hour

  • You can edit Cost per Hour by clicking the cost field on the MO.

    Screenshot showing how to edit cost per hour for an operation directly on an MO
  • If an operation is marked as Completed without any time logged, Katana uses the planned time as the actual time.

    Screenshot showing the status changes for a task on an MO

Cost behavior for partially completed MOs

When a MO = Partially complete:

Screenshot highlighting the completed quantity, Remaining quantity, and Total cost for partially completed MO
  • Katana uses planned costs based on planned ingredient quantity and operations time.

  • These appear as the Total cost of production.

When MO status changes to Done:

Screenshot highlighting the total costs and actual costs for a completed MO
  • Katana recalculates using actual ingredients and time spent.

  • The actual cost is split equally across all produced units.

If a production completion date falls into a closed inventory period, the cost will not recalculate. Katana will lock in the total cost at that point.


Where to view cost per product

Go to:


Stock screen > Products table > Value in stock or In stock column > Inventory Intel

Screenshot highlighting the value in stock and in stock columns found in the stock screen

Inventory intel:

Screenshot example of the inventory intel

There you'll find:

  • Cost / Price per unit

  • Productions with reference to MOs

  • Completed quantities

Depending on MO status:

  • Partially complete → Shows Total cost of production

  • Done → Shows Actual cost per unit


Summary of cost calculations

Scenario

What Katana uses

MO Open

Planned quantity & average cost

MO Done

Actual quantity & time spent

Ingredient out of stock

Default purchase price or 0

No time logged for operation

Planned time

MO completed in closed inventory period

Total cost used, not recalculated


Your feedback is invaluable. Let us know your thoughts on this article or anything in Katana you'd like to see improved: [email protected]

Did this answer your question?