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The solution can be implemented using perpetual costing method or periodic average costing method or both:
Perpetual Costing Method
The business scenario described below can best be implemented using 'Standard' Costing method. Typically the PO price represents purely the Material Costs. It is assumed not to include the other costs like duty, freight, handling etc, which are in the nature of Material Overhead.
In Oracle Cost Management, it is possible to model these costs (duty, freight etc) as Material Overheads. Ideally Material Overhead rates are defined for each item.
Each of these costs can be defined as a Material Overhead Sub Element and be associated to an absorption account. MOH rates can be defined using following allocation basis
a) Item
b) Lot
c) Total Value
d) Activity
Typically each of these costs needs to be estimated for a period or a PO(as the case may be) and allocated based on absorption characteretics like volume, value, handling size etc. Once defined for each item, these costs are absorbed at the time of PO receipt and is thus built into inventory at these estimated/standard rates. The credit goes to the absorption account. The Balance in Sub-Element Absorption account represents total costs allocated to various items.
The difference between the Material Cost Element cost and the PO Price goes into purchase price variance account. But the Material Overhead absorbed is at standard/estimated costs only(true for all costing methods).
When Invoicing happens, distributions are created for each of these additional overhead costs hitting a expense account. Different Expense Accounts can be used to track each of these costs. At the end of the PO cycle or the Accounting period, the Sub-Element Absorption Account can be compared with these expense accounts to identify under/over absorption of these costs. The difference is the variance may be built into the inventory. This can be done using standard cost update request to be run after changing the MOH rates to reflect the actual costs.
May be it is possible to custom derive the accounting segments to ensure item level accounts for booking of these costs.
Other costing methods(Average/FIFO/LIFO) may also be used. The only difference being instead of standard cost update, average/layer cost update needs to be performed.
Periodic Average Costing Method:
This method involves building the landed cost of the item into the inventory. This requires use of 'Match to Receipt' option in the POs. The PAC Acquisition cost process will pick up all the invoices (like freight, tax, misc etc) matched to the PO and will build into the inventory cost of the item. The only downside is these costs go as Material Cost and not as Material Overhead cost(which is the the true nature of these costs). Secondly, if the invoices are standalone expense invoices, the costs cannot be transferred to inventory. The advantage of PAC is the Inventory will be closest to actual landed cost. But Variance Tracking is not possible as there is no MOH absorption happening.
It is also possible to use both the costing method to have Innventory Valuation at landed cost (using PAC) and track variances using perpetual costing. |
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楼主: judyli
IP卡
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发表于 2005-6-15 11:26
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