Per Costing Method

Cost is calculated based on the costing method assigned to the item. For example: LIFO, FIFO, standard, average, and so on.

The costs are sourced from the items in the sequence outlined in the table. For example, refer to row 1 in the below table. An assembly item will source by item location average cost if the value is greater than 0. Else, it moves to the next source (item location last purchase price) and checks if the value is greater than 0. It then goes to the next source (Item purchase price) and checks if the value is greater than 0. If none of the source types provide a value greater than 0, then the price of the assembly item will be 0.

Note:

If the Top Level Only field is not checked, the costs for the assembly item are sourced and aggregated from the component items in the exploded bill of materials.

Item Type	Top Level	Costing Method	Cost Source
Assembly item or inventory item	Yes	Group Average Average	Item location average cost Item location last purchase price Item purchase price
		Standard	For assembly item, the cost is a summation of component item cost. For inventory item, the cost is based on item location standard cost. Item location average cost Item location last purchase price Item purchase price
		Lot Numbered Specific Actual FIFO LIFO, and so on.	For assembly item, the cost is a summation of component item cost. For inventory item, the cost is based on item location standard cost. Item location average cost Item location last purchase price Item purchase price
Inventory item	No	Group Average Average	Item location average cost Item location last purchase price Item purchase price
		Standard	Item location standard cost Item location average cost Item location last purchase price Item purchase price
		Lot Numbered Specific Actual FIFO LIFO, and so on.	Item location standard cost Item location average cost Item location last purchase price Item purchase price

Related Topics

Cost Types for Material Cost Calculation

Per Purchase Price

Per Item Default

General Notices