When we analyze the standard cost shares in Business Central, we notice that there are several columns, some of which need to be added on the page with the Personalize feature.

Basically, when Business Central calculates the standard cost, it does two different calculations, updating different fields: the Single-Level and the Rolled-Up. What is the difference? Let's see it with a simple example.

Let's create a work center with the following costs

Let's create a routing with 10 minutes of run time

This process will therefore have a total cost of €14.00 divided as follows:

Direct cost: €10.00

Overhead cost: €4.00

**Final cost: €14.00**

Let's create a two-level structure now

The unit cost of item C is €1.00, while the cost of B will be made up as follows:

Material cost: €1.00

Direct cost capacity: €10.00

Capacity overhead costs (indirect costs): €4.00

**Final cost B: €15.00**

For item A, its processing cost will be:

Direct cost capacity: €10.00

Capacity overhead costs (indirect costs): €4.00

**Final processing cost A: €14.00**

At this point we might ask ourselves: how much is the cost of the material? We know that the bill of materials for A includes 1 component B, so it might be natural to do this calculation:

Material cost: €15.00

Processing cost: €14.00 (€10.00+€4.00)

**Final cost A: €29.00**

In reality, however, we could also recalculate the cost with a different criterion, that is, allocating the sum of all the costs of the materials only to the material and instead allocating the sum of the capacity costs to the capacity. We would thus obtain:

Material cost: €1.00 (material cost of B)

Capacity cost: €28.00 (€14.00 capacity of B + €14.00 capacity of A)

**Final cost A: €29.00**

Obviously the final result does not change, while the cost allocation criterion does.

The first method is what is called **Single-Level**, while the second is **Rolled-Up**. When we run the standard cost calculation in Business Central, it will provide us with both results, in separate columns:

We can summarize the two calculations with a diagram

Note that in any case, when we produce, the cost of the material consumed will correspond to the value of the product, so €15.00 for each piece consumed. The same variance, in the case of excessive consumption, will be charged as the cost of the material. Below is the statistics of a production order of A of 10 pieces in which one more piece of item B was consumed, with a variance of €15.00.

In essence we can say that in production the Single-Level calculation still applies.

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