A Bill of Materials [BOM] or Product Structure is a list of the raw materials, sub-assemblies, intermediate assemblies, sub-components, parts, and the quantities of each needed to manufacture an end product. A BOM may be used for communication between manufacturing partners or confined to a single manufacturing plant.
A Subcontracting BOM is a regular BOM in every respect, with a ‘parent’ item and one or more ‘child’ items, which are the materials to be worked on to get the finished parent item.
The Black Forrest Cake example shown below will help you understand BOM better
This is the BoM expanded one level, which shows an intermediate product ‘Baked Cake’ from which the finished product is made.
When we explode the BOM fully, we can see the entire hierarchy of materials, with their quantities that go into one finished unit of the intermediate product ‘Baked Cake’. 
. Since this is a multilevel BOM, each item is identified with its level in the BOM as ‘0’ for the finished product of the Subcontract job, ‘1’ for its child item and ‘2’ for child items of level 1.
The next panel shows additional information such as Stock-on-hand (SOH), weight if applicable and unit cost for every BOM item, with the total cost for the item at the BOM-level.
Feedback
Post your comment on this topic.