Processing Landed Cost Transactions

This chapter provides an overview of the Landed Cost Extraction Application Engine process (LC_EXTRACT) and discusses how to:

Note. To run the Landed Cost Extraction process, you must have PeopleSoft Payables, Purchasing, Inventory, and Cost Management installed on the same database. To update subcontracted services to actual costs, you must also have PeopleSoft Manufacturing installed.

Click to jump to parent topicUnderstanding the Landed Cost Extraction Process

Landed cost includes all charges associated with getting an inventory item into your warehouse and available for use or sale. These charges may include material, subcontracted services, freight, insurance, duty, taxes, and handling charges. PeopleSoft Payables features a landed cost extraction module that extracts landed cost data from vouchers, purchase orders, and receivers and passes the data to PeopleSoft Cost Management.

Note. In PeopleSoft Payables, landed cost charges can be attached to vouchers as nonmerchandise charges. Nonmerchandise charges include freight, sales and use tax, value-added tax (VAT), and miscellaneous charges.

Nonmerchandise charges entered on the voucher or copied from a receiver are associated with landed cost codes. Landed cost codes define whether a particular landed cost is to be prorated to the voucher distribution lines or charged to separate expense accounts. If the nonmerchandise charges have a landed cost component, you must prorate the cost. The landed cost code is also associated with an inventory item and indicates whether the charge is to be accrued to an inventory account or expensed at invoice. If the nonmerchandise charges have a landed cost component and are typically charges by the merchandise vendor versus a third-party vendor, you must accrue the cost.

Nonmerchandise charges may be entered on the purchase order. Charges entered on the purchase order are copied onto receivers associated with that purchase order. During voucher entry, nonmerchandise charges can be entered on vouchers received from the merchandise vendor or from third-party vendors. Material charges are matched to the purchase order and receipt using the Matching Application Engine process (AP_MATCH). Nonmerchandise charges, whether vouchered from merchandise vendors or from third-parties, are matched to the receivers by the Landed Cost Extraction process. The Landed Cost Extraction process passes the costs to PeopleSoft Cost Management using the CM_MATCHED_COST and CM_RMATCH_COST records. The Transaction Costing Application Engine process (CM_COSTING) in PeopleSoft Cost Management calculates the purchase price variance (the difference between the vouchered costs and PO costs) and the exchange rate variance (any change in the currency exchange rates between the voucher and the PO).

Note. Nonmerchandise charges that exist on purchase orders but not vouchers are picked up by the Landed Cost Extraction process after the nonmerchandise charges are manually closed.

The Landed Cost Extraction process is a way to pass all receipt-matched information and matched miscellaneous charges to Inventory.

Landed Cost Extraction processes inventory items in these ways:

This diagram illustrates how the Landed Cost Extraction process works:

Landed Cost Extraction process

See Also

Running the Landed Cost Extract Process

Entering Nonmerchandise Charge Details

Click to jump to parent topicPrerequisites

The Landed Cost Extraction process is not set up in PeopleSoft Payables. You set the parameters in PeopleSoft Purchasing and Cost Management.

Define the landed cost component parameters on the Misc Charge/Landed Cost Defn (miscellaneous charge/landed cost definition) page. These include:

See Also

Defining Miscellaneous Charges and Landed Costs

Click to jump to parent topicEntering Landed Cost Transactions Online

Unlike other processes in PeopleSoft Payables, landed cost transactions are not actually entered on a particular page in the application. Instead, you define certain miscellaneous charge codes as having a landed cost element by selecting the Landed Cost Component check box on the Misc Charge/Landed Cost Defn page.

Each time that you use these miscellaneous charge codes on a regular voucher, adjustment voucher, reversal voucher, or a third-party voucher and then run the Landed Cost Extraction process, the system recognizes these charges as landed cost. It extracts them and sends them to PeopleSoft Cost Management where users can analyze and report on them.

Note. All nonmerchandise charges, such as freight, sales and use tax, VAT, and miscellaneous charges, are set up on the Misc Charge/Landed Cost Defn page.

See Also

Entering Third-Party Vouchers

Click to jump to parent topicRunning the Landed Cost Extraction Process

This section discusses how to run the Landed Cost Extraction process.

The Landed Cost Extraction process extracts landed cost data from matched and posted regular vouchers, adjustment vouchers, reversal vouchers, and third-party vouchers and writes data to the PeopleSoft Cost Management CM_MATCHED_COST table for further processing. You run this process from the Landed Cost Extract page.

Click to jump to top of pageClick to jump to parent topicPages Used to Run the Landed Cost Extraction Process

Page Name

Definition Name

Navigation

Usage

Landed Cost Extract

LC_RUN_CNTRL

Accounts Payable, Batch Processes, Extracts and Loads, Extract Landed Cost, Landed Cost Extract

Runs the Landed Cost Extraction Application Engine process (LC_EXTRACT), which can be run for all business units, specific business units, or specific vouchers.

Landed Cost Extract - Messages

AP_MESSAGE_LOG

Accounts Payable, Batch Processes, Extracts and Loads, Extract Landed Cost, Landed Cost Extract, Messages

View error messages associated with previous landed cost extraction requests.

Click to jump to top of pageClick to jump to parent topicRunning the Landed Cost Extraction Process

Access the Landed Cost Extract page (Accounts Payable, Batch Processes, Extracts and Loads, Extract Landed Cost, Landed Cost Extract).

Options

Select the hierarchy level for which you want to run the Landed Cost Extraction process: All business units, Specific business units, or Specific vouchers.

If you select Specific business units or Specific vouchers a message displays indicating that vouchers may be processed in addition to the ones selected by the run control. Additional vouchers are processed by the Landed Cost Extraction process if they are associated with the same receiver line ships. If you select All business units all vouchers in the system will be processed.

The number of vouchers selected by the run control and the total number of vouchers processed by the Landed Cost Extraction process displays in the Landed Cost Extraction Application Engine log.

Note. Additional vouchers are included to help ensure accurate unit cost calculations. These additional vouchers may be vouchers that have been fully extracted by previous Landed Cost Extraction processes or vouchers that are not selected by the current Landed Cost Extraction process run control. Vouchers that are not selected by the current run control, but are included in the unit cost calculations, will be locked and their extract status will be updated.

Click to jump to parent topicReviewing Landed Cost Exceptions

This section discusses how to review landed cost extract exceptions.

Click to jump to top of pageClick to jump to parent topicPage Used to Review Landed Cost Exceptions

Page Name

Definition Name

Navigation

Usage

Landed Cost Extract Exceptions

VCHR_LC_LOG

Accounts Payable, Review Accounts Payable Info, Interfaces, Landed Cost Extract Exceptions, Landed Cost Extract Exceptions

Use to view exceptions generated during the Landed Cost Extraction Application Engine process (LC_EXTRACT).

Click to jump to top of pageClick to jump to parent topicReviewing Landed Cost Extract Exceptions

Access the Landed Cost Extract Exceptions page (Accounts Payable, Review Accounts Payable Info, Interfaces, Landed Cost Extract Exceptions, Landed Cost Extract Exceptions).

The Landed Cost Extraction process generates two types of exceptions:

See Also

Reviewing and Correcting the Results of the Landed Cost Extract