Freight into Items cost
Date: Mon, 6 Sep 1999 16:59:47 -800
From: "Eva Mitchell"meva@flashmail.com
To: oraapps-l@cpa.qc.ca
Subject: PO: Freight into Items cost
Hello,
Let me present my issue. We have average costing at our installation.
We make payments before receiving the items from our vendors. The payment is
made against the invoice that includes freight and duty. We just want to
adjust
the items cost with the freight and other duty (amount in Dollars available
to us from the invoice).
According to the standard PO functionality, on receipt only PO price is
added
("averaged") to the items' cost.
How to include freight and duty (alongwith PO price) into the average cost
of
the items received.
Additionally, what accounts (or accounting transactions) will be needed to
facilitate
the solution.
Thanks in advance.
Eva Mitchell
Date: Mon, 06 Sep 1999 17:30:24 PDT
From: "Prasanna Kumar Jena" pk_jena@hotmail.com
To: oraapps-l@cpa.qc.ca
Subject: Re: PO: Freight into Items cost
Hi Eva,
Costing includes five elements
Material cost
Material overhead
Outside Processing
Resources
Overheads (basically resource overheads)
As far as I know, the best way to include the cost of Freight and other
duties is to include 'good' Material Overheads associated with the
respective items. So when the item gets received into Inventory, it goes
with Material and Material Overhead (due to a good assumption this is almost
equal to the value of Freight and other duties being paid on the PO). If you
come across a better solution please feel free to post it to this list.
Prasanna Jena
Date: Mon, 6 Sep 1999 21:49:35 -0700 (PDT)
From: kartik iyer mukul061292@yahoo.com
To: oraapps-l@cpa.qc.ca
Subject: Re: PO: Freight into Items cost
Hi Eva,
You can follow the steps below to include your frieght, duty ,
insurance etc for the items bought:
1.Define the cost types in Inventory as Average rates
2.Define the cost sub elements :Define the Freight, Duty,Insurance etc.
as sub elements.
3.If by experience you know the Freight,Duty as a percent of the item
cost, you can give the % in the material overdead cost sublement for
each of the sublements
4.Then when the material is received the cost is updated.This is the
average cost which includes the frieght,duty,insurance or any other
sublements which is defined .
I hope this helps you.If any help is required please feel free to
contact me.
Thanks,
Kartik
Date: Mon, 06 Sep 1999 21:55:55 PDT
From: "ravi chandran" johnny_ravi@hotmail.com
To: oraapps-l@cpa.qc.ca
Subject: Re: PO: Freight into Items cost
eva,
we had the same problem for our client and ver 11 provides for landed cost
update while receiving items. I give below briefly the steps to be followed:
1)Define cost type & relate it to the organisation parameter.
2) Define Overhead and validate their applicability for a price term under
MLC. Overheads can be defined as a percentage of the material cost or as an
amount. You can define were the credit for each overhead is to be done.
3) On receiving the item inventory gets updated with the associated cost.
If you want more detail contact me.
Ravi
Date: Tue, 7 Sep 1999 12:14:42 +0700
From: "Nagamohan U." umohan@irs.co.id
To: oraapps-l@cpa.qc.ca
Subject: RE: PO: Freight into Items cost
Hi
In case of Average costing, my understanding is that all the sub elements
that are being mentioned here are not possible.
In the average costing scenario, the cost of the item gets populated through
a PO or through the stock loading.
All the components of the cost are applicable only in the Standard costing
scenario.
Coming to the question of adding the Freight and other additional costs to
the item cost in average costing you have do the following:
1. Raise the PO for the item with normal rate negotiated with the
Supplier.
2. Add a service line for the freight charges in the same PO with the
account you want to debit the freight charges.
3. Receive both the lines in the PO.
4. Perform average cost updatation between the Account given in the
Service line of the PO and the stock account for that particular item.
This is how we can add the additional costs that are incurred in the POs to
the item costs.
Regards/Nagamohan
Date: Tue, 07 Sep 1999 05:42:02 PDT
From: "ravi chandran" johnny_ravi@hotmail.com
To: oraapps-l@cpa.qc.ca
Subject: RE: PO: Freight into Items cost
nagamohan,
The landed cost can be added only by defining the sub elements. It has been
done in our client site and it is working fine. When the actual bills are
booked the variance in freight, insurance etc are absorbed in the COGS.
Your suggestion of adding a line for freight is not correct because:
- You might be buying on FOB terms with supplier and the PO value will
include freight
- Freight can be arranged with a different supplier.
Ravi
Date: Tue, 7 Sep 1999 20:40:42 +0700
From: "Nagamohan U." umohan@irs.co.id
To: oraapps-l@cpa.qc.ca
Subject: RE: PO: Freight into Items cost
Ravi
Thanks for the update.
1. I think the landed cost functionality is not there in the 10.7
version. If it is there please tell me how to use that.
2. Could you please throw some light on how the COGS account comes into
picture here. As far as my knowledge is concerned this account is on the
other side of the Supply chain i.e., Order Entry
3. Is my solution correct if the same supplier provides the freight
services also?
4. What if the other supplier provides the Freight service. In this
case we can still achieve the same result through some work around as we are
doing at our site. We make one PO for the material from one supplier. And
one more PO for the another supplier for freight services. At the time of
making receipt of the this freight service we capture the PO number made for
material for which this freight service is being received in the DFF. We
have a custom report linking these two POs. After the user runs the report
he/she performs the cost update accordingly for the freight value with the
correct account code into the item. Payments are made separately for the two
different suppilers.
Regards/Nagamohan
Date: Tue, 7 Sep 1999 15:51:53 +0200
From: Gorre Richard GorreR@fnherstal.com
To: "'oraapps-l@cpa.qc.ca'" oraapps-l@cpa.qc.ca
Subject: RE: PO: Freight into Items cost
Hi
In 10.7 you can define transportation cost or any other costs like duty, etc
using material overhead elements.
When using material overhead line, the standard cost will take account the
additional value.
COGS will use the standard cost (including land cost)
At receiving stage, the system will create a acrual for the main supplier,
and a other acrual in the account difined in the material overhead
definition. This accrual is for recording transport invoice againt it and
get a view about variances and invoice to be received. (see cost manual)
Richard Gorr
Tel 32 4 240 88 37
Date: Tue, 07 Sep 1999 07:04:28 PDT
From: "ravi chandran" johnny_ravi@hotmail.com
To: oraapps-l@cpa.qc.ca
Subject: RE: PO: Freight into Items cost
Nagmohan,
i have given the reply under the questions raised by you
ravi
1. I think the landed cost functionality is not there in the 10.7
version. If it is there please tell me how to use that.
--Landed cost is not available in 10.7. You should have a workaround or
calculate the associated cost for each item received and update it through
avg. cost update option.
2. Could you please throw some light on how the COGS account comes into
picture here. As far as my knowledge is concerned this account is on the
other side of the Supply chain i.e., Order Entry
-- What i meant was when you are defining associated cost like
freight,insurance etc. either as a percentage of material cost or amount the
inventory cost gets updated on receipt. The credit of the associated cost
can be pooled to an account and when the actual invoice from the supplier is
booked this pool account can be debited.
At the end of the year the variance can be transferred to COGS
Regards/Nagamohan
Date: 7 Sep 99 08:49:11 MDT
From: JONATHAN BOURNER jbourner@usa.net
To: oraapps-l@cpa.qc.ca
Subject: PO: Freight into Items cost
The way that I have handled this in the past has been to write a customized
bolt-on. This bolt on was used to write a transaction into the inventory
transaction open interface with a type of average cost update. The amount was
the amount of the freight and the duty and the item came from the invoice (I
have added the item number as a descriptive flexfield on the invoice
distribution where the freight bill was from another vendor) This is then
written to the Inventory open transaction interface and the interface run to
update the cost of the inventory.
The only problem is with fast moving stock where the item may be issued before
the invoice is received. The bolt on should not create a transaction if the
quantity on hand is 0.
I hope that this helps.
Regards,
Jon Bourner
Date: Tue, 7 Sep 1999 08:01:41 -0700 (PDT)
From: Ravi Krishnamurthy ravi_krishna@rocketmail.com
To: oraapps-l@cpa.qc.ca
Subject: Re: PO: Freight into Items cost
Eva,
You can define material overhead type subelements and associate them
with absorption accounts which hold the other costs of procurement.
You may then associate these subelements to user defined cost types
which can then be associated to the organization when you define the
org parameters.
HTH.
Ravi Krishnamurthy
Uncosted Material - Inventory not closing
Date: Wed, 8 Sep 1999 10:32:47 -0400
From: "Schmidt, Bob" bschmidt@AAFINTL.com
To: "'oraapps-l@cpa.qc.ca'" oraapps-l@cpa.qc.ca
Subject: INV: Uncosted at close
Help - I am trying to close last months Inventory and when I click the
Pending button I am told that there are 9 entries with uncosted
material. I have checked the costs and there are FROZEN costs for these
items in this organization. Where should I look for resolution to this
problem?
Thanks
Bob Schmidt :-)
bschmidt@aafintl.com
EDS
502.637.0446
502.637.0520 (F)
Date: Wed, 8 Sep 1999 16:55:33 +0200
From: Clive Calder CliveC@langeberg.co.za
To: "'oraapps-l@cpa.qc.ca'" oraapps-l@cpa.qc.ca
Subject: RE: Uncosted at close
In Inventory check you Interface managers are running. Specifically in
10.7, your "Cost Manager" under Setup -Transactions- Interface Managers.
Regards
Clive
Date: Wed, 8 Sep 1999 08:24:31 -0700
From: CFowler@littonapd.com
To: oraapps-l@cpa.qc.ca
Subject: RE: Uncosted at close
Hi,
The quickest way I have found to find what the "uncosted" material
transactions are is to run the following sql script:
select transaction_date,
inventory_item_id,
organization_id,
costed_flag,
transaction_id,
transaction_group_id
from mtl_material_transactions
where costed_flag in ('E','N');
This will tell you what has error'd and what has not been costed yet. Then
you can look into each transaction to determine the cause of the problem is
and determine what the resolution should be.
If you don't have access to sql, then you can go to the Material
Transactions form and query up the error'd and/or uncosted material
transactions. Get in "Query Enter" mode. Go to the alternate region
"Reason, Reference", enter "No" or "Error" in the "Costed" field, enter the
month/year (i.e. %AUG-1999%) in the "Transaction Date" field. Do a "Query
Run" to see which transactions are have error'd or are uncosted.
Our environment is IBM AIX 7.3.4 10.7 16.1SC.
I hope this helps.
Candace
Date: Mon, 06 Sep 99 08:51:14 -0800
From: cwright@guthy-renker.com
To: oraapps-l@cpa.qc.ca
Subject: Re:RE: Uncosted at close
You might also want to check that you don't have a transaction stuck in
MTL_MATERIAL_TRANSACTIONS with a Costed_Flag = 'E'. That will cause
subsequent
transactions from the same org to back up waiting for the 'E' to be cleared
up.
SQL code is:
Select * from mtl_material_transactions where costed_flag = 'E';
Date: Wed, 8 Sep 1999 11:42:27 -0400
From: cshay@csc.com
To: oraapps-l@cpa.qc.ca
Subject: Re: INV: Uncosted at close
This is the script you need to run to identify the problems:
select transaction_id, costed_flag from mtl_material_transactions
where costed_flag in ('E', 'N')
To fix the problem do this script:
update mtl_material_transactions
set costed_flag='N', request_id=Null, transaction_group_id=Null
where costed_flag in ('E', 'N')
Let the costing manager cost these. This make take a little while depending
on
how often you have it set to run.
Date: Wed, 8 Sep 1999 13:08:32 -0400
From: "Schmidt, Bob" bschmidt@AAFINTL.com
To: "'oraapps-l@cpa.qc.ca'" oraapps-l@cpa.qc.ca
Subject: RE: Uncosted at close - resolution
Thanks to all who responded so quickly - appears the Cost Manager had
stopped - again
Thanks
Bob Schmidt :-)
bschmidt@aafintl.com
EDS
502.637.0446
502.637.0520 (F)
Intangibles - Change Average Cost to invoice
Date: Sun, 12 Sep 1999 08:51:54 -0400
From: Teresa Purdy TPurdy@Datavision-Prologix.com
To: "'oraapps-l@cpa.qc.ca'" oraapps-l@cpa.qc.ca
Subject: Changing average cost to invoice "Intangibles"
We invoice our customers for intangibles like "Travel Expenses" and
on our legacy system we were able to change the cost on the invoice to
reflect the actual cost that we were billing. For example, we would bill our
customer for $1050 of travel expenses costs incurred by our employee, using
an item number "Travel Expenses" and have a cost of $1050 and also a sales
price of $1050. We could change the cost at the time of entering the line on
an order.
How can we do this in Oracle?
We have thought of a unit of $1 and billing, in the above example,
QTY 1050 of "Travel Expense" at $1 each. This is not acceptable to our
sales group.
We have thought of using "brackets" of costing, with unique part
numbers like "Travel Expense Level 1" with a cost of $500, "Travel Expense
Level 2" with a cost of $1000, so that in the above example, we would
invoice our customer for "Travel Expense Level 2" and the price and the cost
would not exactly match, but the difference could go to a "Travel Expense
'Price Variance" Clearing Account" but this seems messy.
We have thought of a new item number for each invoicing of Travel
Expenses, but this seems impractical.
Any and all thoughts are VERY WELCOMED!!!!
11.0.2 8.0.5 NT AVERAGE COSTING