1. Warehouse Management Implementation Guide
  2. Prerequisites

Prerequisites

To calculate the cost of an item at the Item/Branch/Location/Lot level using Cost Level 3:

  • Verify that the Inventory Cost Level for the item is set to value 3 (Item/Branch/Location/Lot level) in the Item Master Revisions form.
  • Verify that the Update Average Cost On-Line check box in the System Constants form (Branch/Plant Constants P41001 program) is selected to indicate that the system should calculate a new average cost immediately when any inventory transfer affects the average cost of an item.
  • Verify that these automatic accounting instructions (AAIs) are set up for the Warehouse Management System:
    • 4622 – Warehouse Inventory
    • 4624 – Warehouse Expense
    • 4641 - Warehouse Expense

To calculate the average cost (cost method 02) of an item, ensure that the Warehouse Movement Confirmations program P4617 is set up in UDC table (40/AV) and its description code is set to Y.