# Bills of material and work orders

> Define what a finished good is made of, then build it — components out, finished goods in, cost carried across.

Section: Inventory · Canonical: https://intubu.intuitivecapital-dai.com/docs/bom-work-orders

Inventory → BOM and Work orders.

A **bill of material** lists the components and quantities that make one finished good, plus any labour or overhead to absorb. BOMs nest: a sub-assembly can itself have a BOM, and the explosion resolves the whole tree.

**A work order** is one build. When you complete it:
- component stock is relieved at its FIFO cost,
- labour and overhead are absorbed at the rates on the BOM,
- the finished good is received into stock at the total.

Nothing is invented — the finished good's cost is the sum of what went into it.

**Shortages:** before you start, the work order shows what you do not have enough of and what it is waiting on.

**Compare with [Bundles and kits](https://intubu.intuitivecapital-dai.com/docs/bundles):** a bundle is a selling convenience that relieves components at the point of sale. A BOM produces a genuinely new item that is stocked and costed in its own right.