Recording Estimated Landed Costs

The PO and receipt in PeopleSoft Purchasing use an estimated cost. The actual cost is not known until the invoice (voucher) is received and processed in PeopleSoft Payables.

POs

Estimated landed costs appear by default on the purchase order:

Field or Control

Description

Material Costs

The PO price for material costs is derived from the PeopleSoft Purchasing system's pricing structure.

Subcontracted Services

The cost of subcontracted services is derived from the item routing of the production ID. In PeopleSoft Manufacturing, when part or all of the manufacturing process is done by an outside supplier, you need to generate POs for the production IDs with subcontracted operations. Using the Select Subcontract Prdn for PO page in PeopleSoft Manufacturing, you select one or more production IDs, production areas, or item IDs for which to generate POs for subcontracted operations. When you run the Select Subcontract Prdn for PO (SFS5000) process, the system automatically transfers the subcontracted operations information for PO creation to PeopleSoft Purchasing, including the production ID information for which the outside processing must be done as well as the operation sequence that is associated with the outside operation. PeopleSoft Purchasing creates the PO by using the information from the production ID. The Inventory business unit that is used for manufacturing is populated to the PO line. Only one distribution line is allowed for the subcontracted item.

Miscellaneous Landed Costs

Other miscellaneous landed costs are placed on the PO by adding miscellaneous charge codes. Miscellaneous charge codes can be applied to the PO:

  • Automatically: Enter a PO, if any Miscellaneous Charges - Miscellaneous page has the same combination of item category, item ID, supplier ID, supplier location code, ship-to ID, and purchasing business unit, then the charge codes or templates that are defined are placed on the PO. The system then calculates and prorates the estimated landed costs to the PO schedule.

  • Manually add to the PO Header: Attach the miscellaneous charge codes or landed cost templates directly to a PO by using the Header - Miscellaneous page. Use the PO Form: Miscellaneous page to select the miscellaneous charge codes and the lines to which they apply. The system then calculates and prorates the estimated landed costs to the PO schedule.

  • Manually add to the PO Schedule: Attach the miscellaneous charge codes or landed cost templates directly to a PO schedule by using the Schedule-Miscellaneous Charges page. You can also view the landed cost charges that appear by default from the Header - Miscellaneous page and the Miscellaneous Charges - Miscellaneous page.

In all cases, the PO prices can be manually altered before dispatch.

For further information about POs, see PeopleSoft Purchasing, "Creating Purchase Orders Online."

See Understanding the Purchase Order Business Process

Receipts

When the merchandise is received in PeopleSoft Purchasing, the material and other landed cost charges from the PO schedule are copied onto the receipt distribution line. A completed receipt in PeopleSoft Purchasing populates the records, RECV_LN_DISTRIB, RECV_LN_DIST_LC and RECV_LN_SHIP_LC, which are used later by the Landed Cost Extract process to pass data to PeopleSoft Cost Management by using the CM_MATCHED_COST record. For subcontracted services, the production ID information is copied to the receipt line and distribution line. For miscellaneous landed costs, the selection in the Accrue Charge check box on the Misc Charge/Landed Cost Definition page determines if the estimated landed costs are included in the inventory value at putaway or included in expense accounts when they are invoiced.

Once the receipt is recorded in PeopleSoft Purchasing, use the putaway processes in PeopleSoft Inventory to store the item into inventory and record the material and other landed costs.

For subcontracted services, enter the receipt on the Subcontracted Receipt page to complete the subcontracted operation of the production ID. The system records the estimated PO cost or the standard cost, depending on the cost profile of the end item, as a debit to Work in Process (WIP).

Page Name

Definition Name

Usage

Maintain Purchase Order- Header Misc. Charges Page

PO_MISC_WRK

Apply miscellaneous charges that you add on the Header - Miscellaneous Charges page to the lines of the PO.

Header - Miscellaneous Charges Page

PO_HDR_MISC

Enter the miscellaneous charges that you want to allocate to some or all of the lines on the PO using the Maintain Purchase Order- Header Misc. Charges page.

Miscellaneous Charges for Schedule Page

PO_SCHED_MISC

Change miscellaneous charges on this schedule.