This chapter provides an overview of cost updates, lists prerequisites, and discusses how to:
Update item costs.
Work with detail costing in distribution.
You can update costs for items simultaneously, rather than on an individual or cost-by-cost basis. For example, you can implement a percentage increase in the standard cost for a group of items. If you use the average cost method to determine inventory costs, you can update the average cost for all items.
Cost maintenance procedures enable you to update costs for individual items or for multiple items in the branch/plants, locations, and lots that you select. You select the cost method to use for updating costs.
The system stores item costs in the Item Cost File (F4105). After you update item costs, the system updates the F4105 table. After you update costs for an item's sales/inventory cost method, the system creates general ledger (GL) and item ledger records.
See Also
Setting Up AAIs in Distribution Systems
Entering Item Cost Information
Before you complete the tasks in this chapter, you must:
Verify the current cost information for items.
Verify that automatic accounting instructions (AAIs) for changes to inventory costs are set up.
This section provides an overview of item cost updates and discusses how to:
Set processing options for Speed Cost Maintenance (P41051).
Update costs for an item across multiple branch/plants.
Update costs for multiple items across multiple branch/plants.
Set processing options for Batch Cost Maintenance (R41802).
Update average costs for items.
Update current item costs with future costs.
Set processing options for Future Cost Update (R41052).
You can update costs for items in the branch/plants, locations, and lots that you select. You can increase or decrease costs by a percentage or monetary amount, or you can specify a new dollar amount. You specify the cost method for which you want to update costs. You can also update average costs or future costs for all items that you select.
Form Name |
FormID |
Navigation |
Usage |
Work With Location Costs |
W41051A |
Inventory Price & Cost Updates (G4123), Speed Cost Maintenance |
Select branch/plants to work with costs. |
Cost Revisions |
W4105A |
On the Work With Location Costs form, select a record and select Cost Revisions from the Row menu. |
Update costs for an item across branch/plants. |
Processing options enable you to specify the default processing for programs and reports.
Defaults
Enter the default cost method to display. |
Enter a code from UDC 40/CM that indicates the cost method that the system uses to determine the cost of the item for purchase orders. The system reserves cost methods 01–19. |
Process
Standard Cost |
Specify whether to change the standard cost. Values are: Blank: Change 1: Do not change. |
Access the Cost Revisions form.
You can update costs for a single item across multiple branch/plants, locations, and lots. You select the cost method for which you want to update item costs. For example, you can update an item's last-in costs, average costs, and so on. Changes that you make to costs take place immediately.
You can increase or decrease costs by:
A specified amount
A specified percentage
You can also enter a new dollar amount to override the previous cost.
Sales/Inventory/Purchasing Costing Methods |
Enter a code from UDC 40/CM that indicates the cost method that the system uses to calculate the cost of goods that is sold for the item. Cost methods 01–19 are reserved for use. If you maintain costs at the item level, the system retrieves the default value for this field from the data dictionary. If you maintain costs at the item and branch/plant level, the system retrieves the default value from Branch/Plant Constants. |
Select Inventory Price & Cost Updates (G4123), Batch Cost Maintenance.
You can update costs for numerous items across multiple branch/plants, locations, and lots by using the Batch Cost Maintenance program. You can increase or decrease item costs by a specific amount or percentage, or you can identify a new cost.
You can update item costs for the cost methods that you select. For example, you can update last-in costs, weighted average costs, and so on.
Processing options enable you to specify the default processing for programs and reports.
Process
Cost Change |
Enter the cost change to use for update. When entering a percentage, enter it as a whole number. |
Cost Change Type |
Enter the cost change type. Values are: A: Amount percent: Percent *: Actual |
Defaults
1. Reason Code |
Enter a code from UDC 41/RC that specifies a reason for a transaction. |
2. Document Type |
Enter a code from UDC 00/DT that specifies a document type. |
3. GL Date |
Specify the date for the journal entry. If you leave this field blank, the system uses the current period date. |
Print Report |
Specify whether to generate a report. Values are: Blank: Do not generate. 1: Generate. |
Edits
Mode |
Specify whether to update files. Values are: Blank: Do not update files. Run this program in proof update mode. 1: Update files. Run this program in final update mode. |
Select Inventory Price & Cost Updates (G4123), Update Average Cost.
Two methods exist for updating average costs for items:
Interactive.
Batch, through the Average Cost Update program.
To specify that the system updates average costs interactively, you use System Constants. To update average costs in batch mode, you use the Average Cost Update program. You specify the items, branch/plants, locations, and lots for which to update average costs.
Each time that a transaction affects the current cost of an item, the system updates the Average Cost Work file. When you run the Average Cost Update program, the system:
Accesses current cost information from the F41051 table.
Calculates the average cost for each item.
Updates the F4105 table.
Deletes transactions from the workfile.
You can specify the programs that update the workfile by using Define Average Cost, which contains UDC 40/AV.
Before you run the Average Cost Update program, you should be familiar with the cost level of the items that you want to update. You should consider that:
For all items with a cost level of 1, you must specify ALL for the branch/plant and locations.
For all items with a cost level of 2, you specify ALL for the locations only.
If you select to run the update over items from all three cost levels, you should select by item number only.
See Also
Select Inventory Price & Cost Updates (G4123), Future Cost Update.
You can replace current costs with future costs by using the Future Cost Update program (R41052). You select the cost level of the items for which to update future costs. For example, you can list the future cost for the item and branch/plant on the Cost Revisions form as cost method 05. Then, in the data selection for the Future Cost Update program, select items with a cost method of 05.
After you run this program, the system prints a report that lists the new costs and the old costs. The report also lists any errors that detail invalid cost methods.
Processing options enable you to specify the default processing for programs and reports.
Process Cntrl
Cost Method |
Enter a code from UDC 40/UM that specifies the cost method to be updated with a future cost. If you leave this processing option blank, the system updates the cost that is associated with the current Inventory/Sales costing method. |
Document Type |
Enter a code from UDC 00/DT that specifies the document type to be used when writing General Ledger and Item Ledger records. If you leave this processing option blank, the system uses document type WD. |
Date - For GL (and Voucher) |
Enter the general ledger date to be used when writing General Ledger and Item Ledger records. If you leave this processing option blank, the system uses the system date. |
Purge Cost Records |
Specify whether to purge cost records. Values are: Blank: Do not purge future cost records. 1: Purge future cost records. |
Interop
Transaction Type |
Enter a code from UDC 00/TT that specifies the transaction type for the interoperability transaction. If you leave this processing option blank, the system does not perform outbound interoperability processing. |
This section provides an overview of detail costing and discusses how to:
Set up detail costing in distribution.
Create simulated costs for distribution.
Set processing options for Simulated Cost Update (R30840).
Copy manufacturing cost components.
Set processing options for Copy Cost Components (R41891).
In a distribution environment, you cannot calculate costs from bills of material or routings. Instead, the Simulated Cost Update program (R30840) uses costs from the F4105 table to update costs in the F30026 table. Use a processing option to define which cost component contains the costs.
You can specify any cost component to contain the costs. A, B, and C cost components are not hard coded in this environment.
Form Name |
FormID |
Navigation |
Usage |
Work With Branch/Plant Constants |
W41001B |
Inventory Setup (G4141), Branch/Plant Constants |
Select a branch/plant to work with. |
Branch/Plant Constants |
W41001H |
On the Work With Branch/Plant Constants form, select a branch/plant. |
Set up detail costing in distribution. |
Access the Branch/Plant Constants form.
Use Product Cost Detail (Y/N) |
Enter a code that indicates whether Distribution programs use the total cost method or the detailed product cost method. Values are: Y: Detail costing N: Total costing |
Select Product Cost Detail - Distribution (G4125), Simulated Cost Update.
The Simulated Cost Update program (R30840) for distribution is similar to the Cost Simulation program for manufacturing. Use the Simulated Cost Update program to copy costs from the F4105 table to the F30026 table.
After you update simulated costs to determine the effect of changes, you can update the frozen costs with simulated values by running a frozen update.
See Also
Processing options enable you to specify the default processing for programs and reports.
Process
Purchased Cost Method |
Enter the cost method (for example, 01, 02, or 03) to move from the F4105 to the F30026 table. If you leave this processing option blank, the system does not move costs. |
Manufactured Cost Method |
Enter the cost method (for example, 01, 02, or 03) to move from the F4105 to the F30026 table. If you leave this processing option blank, the system does not move costs. |
Cost Type |
Enter the cost type (for example, A1, or X1) to use when bringing cost from the F4105 table. |
Defaults
Cost Method to Calculate |
Enter the cost method to calculate (for example, 01, 02, or 03). If you leave this processing option blank, the system uses cost method 07 (standard). |
Report Selection |
Specify how the report will print. Values are: 1: Print all the selected items. 2: Print only changed items. |
Select Inventory Price & Cost Updates (G4123), Copy Mfg. Cost Components.
Use this program to copy costs from the F30026 table to the F41291 table. You can copy simulated or frozen costs for the cost method that you specify.
Processing options enable you to specify the default processing for programs and reports.
From
Cost Method |
Enter a code from UDC 40/CM that specifies the cost method to copy. If you leave this processing option blank, the system does not copy costs. |
Costs to be Copied |
Specify which costs should be copied. Values are: 1: Simulated 2: Frozen |
Landed Costs
Effective From Date |
Enter the effective from date for the cost component. The default is today's date. This date is used for effectivity checking on existing cost components and for writing new cost components. |
Effective Thru Date |
Enter the effective through date for new cost components. The default is December 31st of the century change year (default value from CENTCHG in the data dictionary). |
Default
5. GL Class Code |
Enter a code from UDC 41/9 that specifies the GL category code. |
6. Supplier Number |
Enter an address book number for your supplier. |