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a) Cost Organization

b) Inventory Organization

c) Sub-inventory or

d) Locator

 

 

 

2. How can I have my item costs common across various warehouses / branches / inventory Organization ?

 

If you need to have item costs to be common across various inventory organizations, then you need define the organization structure where there is single cost organization and all the inventory organization should be linked to this single cost organization. The valuation unit level should be set as cost organization. This will ensure the costs are common across the inventory organization.

 

3. Is it possible to have item costs common across various business Unit?

 

No, it is not possible to have item costs common across various business unit. The highest level of the valuation unit can be set only at the cost organization level. Cost Organization is linked to business unit. You cannot have one cost organization linked to multiple business unit.

 

 

4. What is the difference between transaction date, costing date and accounting date for inventory transactions?

 

 

Transaction date is the date when the transaction happens.

Costing Date is the date when the cost is getting assigned to the transaction. There can be practical scenarios where at the time of transaction, the cost may not be available to assign. As and when the cost is available for the item, the same will get assigned. Hence costing dates can be much later than the transaction date.

Accounting date is the date when the transaction is accounted. Accounting can happen only after the transaction is costed.

Transaction date will always be less than or equal to the costing date.  Accounting date will always be greater than or equal to costing date.

 

 

5. What are the most common reasons where inventory valuation report and GL does not match for the inventory accounts?

 

 

Configuration Mistake: One of the most seen issues are due to mistake in the configuration. In the subledger accounting the Inventory accounts should be mapped ONLY to the Inventory Valuation account class. Assigning inventory accounts to any other account class will create reconciliation issues.

 

User Mistake: Inventory Account should not be manually selected for any transaction. If the user selects the inventory account in the PO charge account or accounts payable or in manual journal voucher, this will create mismatch between the inventory valuation report and the GL.

 

Date : If the costing date and the accounting date are in different periods, then the inventory valuation report and the GL will be off for that specific period.

 

 

6. How to identify if there are any uncosted or unaccounted inventory transactions?

 

 

Run the Period End Validation program for the inventory organization. It will provide you the list of all the transactions that are pending.

 

 

7. How to ensure that all inventory transactions are costed?

 

 

Need to run the following processes at the end of each month.

a) Transfer Transactions From Receiving to Costing

b) Create Receipt Accounting Distributions

c) Transfer transactions from inventory to costing

d) Create Cost Accounting Distributions

It would be enough if you run the above programs in the same sequence to ensure all inventory transactions are costed.

 

 

8. How to ensure the cost of goods sold entry is properly costed and accounted?

 

 

Cost of goods sold entry happens after you successfully complete the revenue recognition process. Make sure to run the IMPORT REVENUE LINES and RECOGNIZE REVENUE Programs for all Business Units which are related to the Inventory Org. Once completed, make sure Create cost Accounting distributions & Create Accounting is completed .