Aside from Component Items setup on the Assembly Item Records, other Labor and Machine Related Costs from the Manufacturing Routing Records are added.
The computation for quantity is as follows.
These can be seen on your Default Manufacturing Routing Record. If you do not have a default, it will be the first created Manufacturing Routing for an Assembly Item.
Labor Cost Related:
((Labor Resources * Setup Time (Min)) / 60)/ Costing Lot Size = Labor Setup Quantity
(Labor Resources * Run Rate (Min/Unit)) / 60 = Labor Run Quantity
Machine Cost Related:
((Machine Resources * Setup Time (Min)) / 60)/ Costing Lot Size = Machine Setup Quantity
(Machine Resources * Run Rate (Min/Unit)) / 60 = Machine Run Quantity
Note: They are divided by 60 since all costs are on a per hour basis.
After generating the quantity, they are summed up on a per Cost Category basis. All Routing Components using the same Cost Category will have their Costs and Quantities summed up.
Costing Lot Size is found on the Locations Sublist of the Item Record. The Default Value is 1