1. Using Project Costing
  2. Considerations for Capturing Inventory Costs

Considerations for Capturing Inventory Costs

You can capture inventory costs using one of the following options:

  • ADFdi Excel workbooks, such as Create Costed or Accounted Transactions for Third-Party Applications

  • Import Project Inventory Costs file-based data import feature

  • Create Transaction action on the Manage Unprocessed Costs page

  • Create Miscellaneous Transaction action on the Inventory work area

Consider the following settings to capture inventory costs.

Transaction Source Document Entry

You must use a transaction source document entry which supports the inventory expenditure type class. Set the value of the expenditure type class in the document entry to Inventory by using the Manage Project Transaction Sources task from the Setup and Maintenance work area.

Expenditure Organization

You must set the inventory organization to which the inventory item is assigned as the project expenditure organization. Enable the option Classify as project expenditure organization for the inventory organization by using the Manage Project Organization Classifications task from the Setup and Maintenance work area.

If the organization hierarchy type isn't set to None in the Manage Organization Hierarchies and Classifications setup task, then you must additionally include the inventory organization in the organization hierarchy.

Rate Derivation for Inventory Items

For planning:

  • If organization is part of the resource breakdown structure format, then the application considers the organization as inventory organization and inventory item rates are derived based on that organization.

  • If organization isn't part of the resource breakdown structure format, then the application derives inventory item rates based on the default organization that's defined as the item master in the Manage Resource Classes setup task.

  • If inventory item is part of the resource breakdown structure format and organization is included in the format hierarchy, then the organization defined in the resource breakdown structure format hierarchy determines the planned inventory item rate.

For cost transactions created in Project Costing, the inventory item rates are derived based on the nonlabor cost rate schedule assigned in the project organization costing rule. For transactions that are imported from Oracle Fusion Inventory Management, the expense cost profile of the inventory item defined in the Manage Item Cost Profiles setup task determines if the application derives average or standard cost rate for the item.