Defining Miscellaneous Charges and Landed Costs

This chapter provides an overview of miscellaneous charges and discusses how to define miscellaneous charge defaults.

Understanding Miscellaneous Charges

You can add miscellaneous charges to a purchase order in addition to sales and use taxes and value-added taxes (VAT). Miscellaneous charges can include freight, set up, insurance, and a variety of other costs incurred to deliver purchased goods to a location. Designating the charge as a “landed cost component” also enables you to incorporate the additional cost into the item's inventory value.

If you have PeopleSoft Inventory and PeopleSoft Cost Management installed, the landed cost charges may be defined as additional costs, beyond the merchandise value of the item. Depending on the costing method defined for the inventory item, the values associated with the additional costs are used to value inventory transactions or treated as variances against the item's standard cost. Comparisons of estimated and actual landed costs are provided through PeopleSoft Cost Management reports.

If you do not have PeopleSoft Cost Management installed, you can still define and use miscellaneous charges that are added to the purchase orders. You can set up PeopleSoft Purchasing to automatically calculate miscellaneous charges based on items, item and vendor combinations, and other criteria. A calculation method is assigned to each miscellaneous charge, and an allocation method is assigned to each component. Alternatively, you can manually add miscellaneous charges on the purchase order.

To use miscellaneous charges and landed costs in PeopleSoft Purchasing, set up miscellaneous charges on the Misc Charge/Landed Cost Defn page.

Optionally, you can use the Misc Chrg/Landed Cost Template page to define templates that group several miscellaneous charges. These templates can be associated with an item, category, purchase order, or purchase order schedule. Receipt lines are assigned the estimated costs of their associated purchase order schedule.

Once you have created miscellaneous charges and miscellaneous charge templates, you can assign them to purchase orders on the Header - Miscellaneous Charges page. You can also assign miscellaneous charges and templates to items and categories using the Miscellaneous Charges - Miscellaneous page.

Defining Miscellaneous Charge Defaults

To populate the purchase orders with the correct miscellaneous charge codes or landed cost templates, you must design a series of parameter combinations. When you enter a purchase order that matches the combination of parameters that you defined, the assigned charge code or template is used.

You can set up default miscellaneous charges that are automatically calculated based on the following combinations, where level one overrides level two, and so on:

Level	Miscellaneous Charge Hierarchy Criteria
1	Item, vendor, business unit, and ship to location. (INV_ITEM_ID, VENDOR_ID, BUSINESS_UNIT, and SHIPTO_ID)
2	Item, vendor, and business unit. (INV_ITEM_ID, VENDOR_ID, and BUSINESS_UNIT; and no SHIPTO_ID)
3	Item and vendor. (INV_ITEM_ID and VENDOR_ID; and no BUSINESS_UNIT nor SHIPTO_ID)
4	Item. (INV_ITEM_ID; and no VENDOR_ID, BUSINESS_UNIT, nor SHIPTO_ID)
5	Category, vendor, business unit, and ship to location. (CATEGORY_ID, VENDOR_ID, BUSINESS_UNIT, and SHIPTO_ID; and no INV_ITEM_ID)
6	Category, vendor, and business unit. (CATEGORY_ID, VENDOR_ID, and BUSINESS_UNIT; and no INV_ITEM_ID nor SHIPTO_ID)
7	Category and vendor. (CATEGORY_ID and VENDOR_ID; and no INV_ITEM_ID, SHIPTO_ID, nor BUSINESS_UNIT)
8	Category. (CATEGORY_ID; and no INV_ITEM_ID, VENDOR_ID, BUSINESS_UNIT, nor SHIPTO_ID)

For example, you can set up miscellaneous charges that are automatically calculated on the purchase order when a certain item is ordered from a particular vendor, for a particular business unit, and a specific ship to location of the business unit. You can also set up a miscellaneous charge that is automatically calculated for a particular item.

Only one Miscellaneous Charges - Miscellaneous page combination is used. The higher level overrides the lower level. For example, suppose that you defined miscellaneous charges for an item (level 4), and also for the category (level 8) to which the item belongs, only the miscellaneous charges that you defined for the item are used. The miscellaneous charges that you defined for the category are only used for items that do not have miscellaneous charges specifically defined.