Understanding Average Cost Adjustment Transactions

Average cost value adjustment transactions occur when adjusting the cost of the perpetual weighted average cost or the retroactive perpetual weighted average cost items and the resulting change in inventory value. Value adjustments for items using perpetual weighted average costing or retroactive perpetual weighted average costing can be:

  • Manually created using the Adjust Average Cost page or the Adjust Retro Costs page.

  • System created by the Transaction Costing subprocess within the Cost Accounting Creation process.

These transactions are displayed in this table:

Transaction Group Description Transaction Process Menu Path

205

Value Adjustment.

Records an adjustment to change the value of the current inventory stock for a specific item using perpetual average or retroactive perpetual average costing.

This transaction group applies only to perpetual average and retroactive perpetual average items.

  • Cost Accounting, Item Costs, Update Costs, Adjust Average Cost

  • Cost Accounting, Item Costs, Update Costs, Adjust Retroactive Averages

401

Wt Avg Updates from AP.

Records an adjustment to update the perpetual weighted average cost with posted purchase price variances (PPV).

Cost Accounting, Inventory and Mfg Accounting, Create Accounting Entries, Inventory Transaction Costing. Select the Apply Perpetual Average Adjs check box.

403

Wt Avg Cost Updates - ERV.

Records an adjustment to update the perpetual weighted average cost with posted exchange rate variances (ERV).

Cost Accounting, Inventory and Mfg Accounting, Create Accounting Entries, Inventory Transaction Costing. Select the Apply Perpetual Average Adjs check box.

405

Wt Avg Update Writeoffs.

Records an adjustment to account for any PPV or ERV not applied into the perpetual weighted average cost.

Cost Accounting, Inventory and Mfg Accounting, Create Accounting Entries, Inventory Transaction Costing. Select the Apply Perpetual Average Adjs check box.