For average cost organizations only, you can directly
update the average cost of items to include additional costs, such as freight,
invoice price variances, or job variances. You can update one or more cost
elements or levels (this and previous) individually or to the total unit cost.
Any change made to the total unit cost is spread to all cost elements and
levels in the same proportion as existed prior to the update.
Note: Average cost updates that fail can be viewed and
resubmitted, using the View Material Transactions window from the Cost
function. See Error Resubmission.
You can make the following three types of updates:
a new average cost - enter the new cost by cost element
and level (and the new total unit cost is automatically calculated), or enter a
new total cost (the amount of change will automatically be proportioned across
all cost elements and levels); onhand inventory in all subinventories in the
cost group will be revalued. If you are updating the cost of an item in common
inventory, the cost of that item in intransit owned by the current organization
will also be updated.
the percentage change in the unit cost - select cost
element(s) and level(s) to adjust up or down (and the new total unit cost will
be automatically calculated), or adjust the total (the percentage change will
automatically be applied to all cost elements and levels); onhand inventory in
all subinventories in the cost group will be revalued.
the value change by which onhand inventory is to be
incremented or decremented - select cost element(s) and level(s) to be adjusted
or adjust the total and the system will revalue onhand inventory by that amount
and recalculate the item's average cost for the cost group. You cannot change
the average cost in this way unless the item has quantity on hand.
Additional Information: Average cost update
transactions are inserted into the Open Item Interface in Oracle Inventory.
Update transaction details can be viewed using the Transaction Interface
Details window. This window is accessed using the Cost Detail button from the
Oracle Inventory Transaction Interface window. See: Viewing and Updating
Transaction Open Interface.
Oracle Inventory Open Interfaces, Oracle Manufacturing,
Distribution, Sales and Service Open Interfaces Manual.
To update
total unit average costs:
1. Navigate to the Update Average Cost window.
2. Select a transaction date.
You can select any date within an open period, up to
and including the current date.
3. Select the Average cost update in the Type field.
4. Optionally, select a Source type for the
transaction.
Source types define origins for transactions.
5. Select an average cost update Adjustment Account.
If you increase average costs, debit your subinventory
accounts and credit the specified adjustment account. If you decrease average
costs, the reverse adjustments are generated.
You must select an Adjustment Account.
6. If you are updating costs using a percentage change,
enter a default to use as the percentage change for individual item costs.
7. Select the item for the average cost update.
8. Select a Cost Group.
If the Project References Enabled and Project Cost
Collection Enabled parameters are set in the Organization Parameters window in
Oracle Inventory, you can select a cost group. See: Organization Parameters
Window and Defining Project Information.
If these parameters are not set, the Common group is
used.
9. Update the total unit average cost. Do one of the
following:
Enter a New Average Cost. This value cannot be
negative. On-hand inventory in all subinventories and intransit are revalued.
Enter a percentage change in the item's average cost.
The item cost is updated by this percentage value. On-hand inventory in all
subinventories and intransit is revalued.
Enter the amount to increase or decrease the current
on-hand inventory value. To decrease the value, enter a negative amount.
However, you cannot enter a value that drives the inventory value negative.
On-hand inventory is revalued by this amount and the
item's average cost is recalculated by dividing the on-hand quantity into the
new inventory value. You cannot change the average cost value by this method
unless the item has quantity on-hand.
The offset to the inventory revaluation in all cases
above is booked to the average cost adjustment account(s) specified at the time
the update is performed.
10. Open the Value Change tabbed region and review the
change in inventory value.
11. Optionally, open the Comments tabbed region and
enter a reason for the transaction. Use a reason code to classify or explain
the transaction.
12. Optionally, enter up to 240 characters of reference
text.
13. Optionally, choose the Cost Elements button to
update average costs by element by level.
To update
average costs by element and / or level:
Note: This section is only relevant if you set the CST:
Average Cost Option to Inventory and Work in Process.
1. Navigate to the Cost Elements window. Do this by
choosing the Cost Elements button from the Update Average Costs window.
2. For each level and / or element, do one of the
following:
Enter a New Average Cost. On-hand inventory in all
subinventories and intransit is revalued.
Enter a percentage change in the item's average cost.
The item cost is updated by this percentage value. On-hand inventory in all
subinventories and intransit is revalued.
Enter the amount to increase or decrease the current
on-hand inventory value. On-hand inventory is revalued by this amount and the
item's average cost is recalculated by dividing the on-hand quantity into the
new inventory value. You cannot change the average cost value by this method
unless the item has quantity on-hand.
The offset to the inventory revaluation in all cases
above is booked to the average cost adjustment account(s) specified at the time
the update is performed.
3. Save your work.
