Before you configure your manufacturing setup, raw materials needed for manufacturing the product, by products created and manufacturing item type must be setup first in your inventory items.
Here is an example of items created for manufacturing.
Items highlighted in yellow are raw materials needed for manufacturing
Item highlighted in green is the by-product item
Item highlighted in pink is the main item to be manufactured.
As shown in this screenshot, Dining Table is set up as Manufacturing Item type. Last Cost and In Stock qty is still zero, these will be updated after completing the manufacturing process.
The next screenshot will show where you can set the main item as Manufacturing Item type.
Move to the next topic: Chapter III : Fixed Asset Setup