Enable Account Combination Derivation for Costing Distributions with the Periodic Average Cost Method

In the periodic average cost method, the cost of an item can change every time you run the cost processor because the cost is calculated based on all the cost owned transactions in the period. To view the impact on accounting during the period and before the period is closed, you can derive the account combinations when you run the Create Cost Accounting Distributions process if you're using the periodic average cost method.

Using the Transaction Account Definition option in Cost Accounting, you can set up mapping sets to identify and stamp the account combinations on costing transactions.

To enable this, you must perform these tasks:

1. Set up subledger accounting options.

2. Create the CST_DERIVE_CCID_DISTRIBUTIONS_FOR_PAC profile option.

3. Enable the CST_DERIVE_CCID_DISTRIBUTIONS_FOR_PAC profile option.

4. Configure the mapping sets.

Set up Subledger Accounting Options

1. In the Setup and Maintenance work area, navigate to Cost Accounting > Manage Subledger Accounting Options.

2. Search for the required ledger.

3. Select the Cost Management subledger for the selected ledger and click edit in Accounting Options.

4. Set the Transaction Account Definition option to Costing Transaction Accounting Definition for Standard Accrual.

5. Click Save and Close.

Create the CST_DERIVE_CCID_DISTRIBUTIONS_FOR_PAC Profile Option

1. In the Setup and Maintenance work area, access the Manage Profile Options task.

2. Click the new (+) icon.

3. Set the parameters on the Create Profile Option page.

   • Profile Option Code: CST_DERIVE_CCID_DISTRIBUTIONS_FOR_PAC

   • Profile Display Name: Derive distributions for costing transactions

   • Application: Cost Management

   • Module: Cost Accounting

   • Description: Derive distributions for costing transactions

   • SQL Validation: Select MEANING, LOOKUP_CODE from FND_LOOKUPS where LOOKUP_TYPE='YES_NO'

   • Start Date: First date of the current open period or today's date

4. Click Save and Close.

Enable the CST_DERIVE_CCID_DISTRIBUTIONS_FOR_PAC Profile Option

1. In the Setup and Maintenance work area, access the Manage Cost Accounting Profile Options task.

2. Search for the CST_DERIVE_CCID_DISTRIBUTIONS_FOR_PAC profile option code.

3. Click the new (+) icon in Profile Values and set the parameters:

   • Profile Level: Site

   • Profile Value: Yes

   Click Save and Close.

Configure the Mapping Sets

In the Setup and Maintenance work area, access the Manage Transaction Account Definitions task. The Transaction Account Definition uses the predefined Account Combination Rules. You can use the predefined mapping sets that are linked to these Transaction Account Types to set up the mapping sets. For example, for the Inventory Valuation account, you need to identify the mapping set linked to the Inventory Valuation account combination rule and modify it as per your requirements. Because this is a predefined mapping set, you can only add the chart of accounts and enter the conditions in the Mappings section.