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now for the material, i went into my resource sheet and saw that there is a material type there. when i did that i can only enter value to standard rate. a single lump sum value for that material. so this means, material may only be a lump sum entry correct?
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No. You can define material resources per unit. For example gallons of paint. You then define the cost per gallon.
You may then assign 5 gallons of paint to a task, and Project will calculate units * rate to show cost for that material resource for that task.
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for the cost resource type however when i changed the type to cost, all fields just closed for entry. i can not enter any value anywhere. Or do i need to insert a certain column?
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You enter the cost for the cost resource when you assign it. Click on a task, click the assign resources button and you'll see a cost field in the assign resources dialog.