I am working with multilevel BOM. I define my finish good ant its BOM. Some of the materials are also manufactured items. When I list the multilevel BOM it looks ok because shows the materials in level 1 and 2. My problem is when I create a production order and report the operations completed (I am using material backflush). All the materials belonging to the first level reduce but the materials belonging to the preassembled items do not reduce. When I make a production order of the preassembled item it works fine. I did run session "Update low level codes and detect loops" but it did not help. In the item master table the two fields for backflush are set to yes for all the materials. I want this to work with the product configurator as well.
I need help in this or please advice on where to find documents about this.

This is correct. Materials for sub-assemblies will only be issued if the sub-assembly is marked as a Phantom. If a Sub-assembly is not a Phantom, then the sub-assembly itself is issued, not its components.

Thanks PrinceUK. It works perfect defining my preassembled item as phantom. The backflush fields are set to Y the first one and N the second one

This solution works for normal manufacture items but it does not work for Customized items, that is when using the product configurator and Projects.