Rollup Issue On Average Costing Method

Hi,
I want to understand correctly the meaning of the rollup on 'Average' costing method.
As I understand it, the rollup is meaningful on 'standard' costing method, when I change the costs for some/all items, and I wanted to update the cost of the items parents appropriately.
But in the 'average' costing, if I change the cost for some child item, the cost of the parent will changed by the average by the time.
When I use the rollup on 'Average' costing method ?
Thanks.

hi,
u cannot perform rollup on average costing method.

Similar Messages

Average Cost Method

Hi all
- I'm starting a test for an average cost method Organizations, (Inventory,Purchasing ,Order Management)
-Is it necessary to enter the receipts and issues day by day to keep the Financial Transactions posted from the issue by correct averge cost calculated
as i know the Issuing Txn is:
Dr : COGS (Item Qty * Average Cost Calculated)
Cr : INV (Item Qty * Average Cost Calculated)
Regards
Amr Hussien

Since you are using average costing, time has impact. for example, If you have PO for an item with 2 different Prices.PO1 and PO2. Once you receive the PO1, your average cost is to be based on PO1.so if you delayed the receipt, the true cost is not reflected for the txn occurred on the day at which PO1 is received. Similarly assume that if you receive PO2 , and making entry of PO1 and PO2 in the same day. The average cost is calculated on the day of entry. But the cost is not reflected for the transactions that were done earlier to the receipt of PO1PO2. In this case, your objective of using average cost is lost. So it is necessary to receive the Items into stock as quick as possible.(Set dead lines for inspection, receiving into stock..etc),
thanks,
dr

Assembly cost rollup wrong for averag cost org

HI,
For two of the assembly items , when we complete wip jobs cost is coming as very less.
When i see the item cost for these 2 assembly items , it seems cost rollup is not correct.
Cost elements unit cost and material are showing up same value :X$
Remaining fileds material overhead,Resource, Outside processing and resource overhead are blank with no cost.
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Please let me know the way to correct them.
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Vasudha.

Hi,
1. are all the 4 lines for same job? -- Yes
please provide details of accounts on each of the 4 lines.
For first 2 lines -- I00195-050002001-0-0-WB02-0-0-0 -- Inv valuation
for 2nsd 2 lines -- I00195-052000000-0-0-WB02-0-0-0 -- WIP valuation
2. have you setup any overheads?
My guess is that the 4 lines corresponds to
16625.29 WIP Assy Completion 30 => Inv Valuation Debit
5689.43 WIP Assy Completion 30 => Inv Valuation Debit
-16625.29 WIP Assy Completion -30 => WIP Material Account Credit
-5689.43 WIP Assy Completion -30 => WIP Resource Account Credit
Can you confirm? --Yes
3. Go thru item cost history of finished good item and see if there is any change in cost on transaction date of WIP Completion Transaction.
Check the details of cost elements.
Distribution 4 lines are with date 02-FEB-2012 14:07:26
If I look at record history of item costs form for this item last update date is -- 10-MAY-2012 15:19:03 and cost elements also of same date (costs button in item costs window)
Here I can see costs as below
Cost element basis rate or amount unit cost
Material item 17.88 17.88
Material item 0 0
OSP item 0 0
OSP item 0 0
Please let me know if anything is required from my side to analyse the issue .
Thanks for your response
Vasudha.

Costing process in average costing

Dear Experts
We are using average costing method for our organization, and manufacturing is MTO.
In this for every order we create new BOM, but when we run cost rollup it shows 'ZERO'. how to roll cost before doing manufacturing.
Please help
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Sandeep

Have you entered costs for the underlying components?
Have you defined routing?

Changing the GL Cost Method in the Fiscal Policy

Hi all,
I would like to know what will be the effects if I change the GL Cost Method in the Fiscal Policy. My client wants to go from PPAC to Lot Costing. But I will also want to know what will be the effects if I go from an average cost method to the Standard cost method.
Thank you.

Hello
I am in R11 and implementing R11 , can someone help me with documentation?.
I have defined the lost cost method and assigned it to the GL Cost Method in the Fiscal Policy, when i run the cost update process with the alternate method for lot costing ( Pmac) a warning error displays indicating the Cost Method in the Fiscal Policy is not the same as the one indicated on the actual cost process ( since i have ingredients based on the actual cost method ant not lot controlled i have to run this process previously)
can someone help on this?, at this point im really confused
In advanced many thanks for your help
regards
mariana
[email protected]

Moving Averge Cost Method

Dears,
I would like to use the Moving Average Cost Method at OPM,
Moving Average Cost Method from Costing Point of View ,it Calculates the Average Cost for every transaction and Post the Transaction Journal with the new cost one by one at the average cost calculated due to every transaction.
Moving Average Cost Method from Oracle Point of View (PMAC),it Calculates the Average Cost for all transactions at the period , get one average cost and Post the all Transactions Journals with the only one cost (which calculated against all transactions).
How can i get the first way at Oracle
Regards
for more explanation please advise

OPM allows third cost method - Lot Costing. You have to figure out if this suites to your requirement.

Using Perpetual Weighted Average (PPAC) as costing Method in R12.1.1

I have setup a company having two operating units both using same ledger and same calendar. One of the operating unit is using Period Moving Average Costing (PMAC) and the other one is using Perpetual Weighted Average (PPAC). Both operating units have manufacturing organizations where batches are being created and cost of finish product is based on the ingredients consumption of the batch. My issue is that I cannot figure out how the cost is being computed for an item that has been produced from a production batch using the PPAC method. For the PMAC, I can see that it is using previous month balance and cost and compute it with current transactions data. But for PPAC, it is difficult to analyse the cost, and the only explanation from oracle note said that the calculations is based on all transactions within ALL period in the costing calendar. How will I calculate the cost for a specific item if the calendar started from July 2009. Should I compute the cost for an item for all transaction from July 2009 until April 12 ? Should I keep different calendar for each financial year or only one calendar is enough?

I just waring you to be careful about PPAC.
1. The value cost adjustment and unit cost adjustment will use to calculate item cost in single period only.
2. Cost revaluation will make you can't reconcile between GL amount and inventory valuation.
3. If your stock is 0 at the end of period your GL amount will still have value but inventory valuation is 0.

Change costing method from Moving Average to Standard costing

Hi Expert
I need to find out the prerequisites for changing the valuation method of an item from Moving average to Standard costing.
(In the forums i found a note which discusses the change of costing method from FIFO to Moving average.)
It would be greatly appreciated if i can get a reply ASAP
Thank you
Regards
Apsara

Hi Son
Let me rephrase my previous question as i have asked it incorrectly.
Step 1. Make all quantities of the stock zero and also close all Open PO, SO etc
Step 2. change the inventory valuation method
Step 3. Enter new stock prices for the standard cost through stock revaluation. My question is can this be (step 3) done through DTW
Thank you
Kind Regards
Apsara

Assembly cost rollup using Average costs

Hi
I'm working on 11.5.5 On Vision instance on Solaris.
I did an Assembly cost rollup of an assembly in an Average Costed Oraganisation ( M3 - Dallas Manufacturing ) . The resource costs , overhead costs are getting rolled up , but the Material and Material Overhead Elements costs are not getting rolled up . Can any one help me on this ?
I have defined an Average cost type of each of the components involved and the assembly , set the default as this cost type itself ( User defined - AvgRates). I have chosen 'Include in Rollup ' for all the components and the assembly. Chosen 'Based on roll' option for only the assembly - disabled it for the components.
Thanks in advance
Regards
Rajesh Shinde

Hi,
Why you need to rollup the cost for average costing? You will get the cost of this while you do the job close..
You need to do the cost rollup for std cost to fix the cost for the assembly...
Regards,

Average Costing - sub inventory rollup

Hi,
I am writing some reports that use average costing.
The reports need to report average cost @ subinventory level, but also @ inventory level.
Does Oracle maintain average cost information @ all levels of the hierarchy or do i need to recalculate @ run time for the the master inventory?
Thanks.

More clarification on this - you can find this on metalink -
The five Valuation accounts and the default Expense account are
defined at the organization level. The valuation accounts apply to
each subinventory and intransit within the organization. They
cannot be changed at the subinventory level under layer costing.
The expense account defaults to each subinventory within the
organization and can be overridden.
You can choose a different valuation account for each cost element, or use the same account for several or all elements.
How you set up your accounts determines the level of elemental
detail in the General Ledger and on Inventory valuation reports.
The system maintains the average unit cost at the organization level; it
does not use any subinventory valuation accounts. If you had separate
valuation accounts by subinventory, total inventories would balance,
but account balances by subinventory would not match the inventory
valuation reports.
Edited by: Aglx on Mar 4, 2010 1:44 PM

How to Change Costing Methods Average Costing to FIFO Costing

hi folks,
i had requirement i.e i want to change from average costing to fifo costing in my current company?
how can we change this?
any solutions will be appreciated
regards,
sri

Look at the default categories form to find the category that is is assigned for inventory.
Then go to the category set and see what the level of control is. If it is master see if you can change it to organization. (If items are assigned you may not be able to).
I think then you can change the attribute controls.

Average cost source

Hi all,
I want to change the cost of an Item to a fixed cost while in organization default costing method is Average.
Can any one tell me the tables affected when the average costing is done.
Looking for your positive response..

Hi all,
There is only one way I have found that to update the average cost every time the the costing process updates to new cost. I have used a trigger in MTL_MATERIAL_TRANSACTIONS table after update of NEW_COST when the INVENTORY_ITEM_ID=1111 and TRANSACTION_TYPE_ID=44 and submitted a job that inserts a row for average cost update with costed flag=N. After the costing process is done, next time when I issue this item to discrete manufacturing job it takes that updated cost.
Thanks and Regards
Sandy

FIFO costing method - what table ?

Hi all,
I got one child org. which is on FIFO costing method and I got the standard report from Oracle which show the total value of the item.
Now, I'm intend to write a report to show the details on what value the system will picked up individually when there is a move order/ issue that happened. What are the tables that involved when there is a move order/ issue for the item. I can see
mtl_cst_actual_cost_details which has new_cost, prior_cost & actual_cost. But when come to move order/issue the actual_cost was average up. I can't see the FIFO picking up ?
Please advise.
rgds
Lim

Please post this in the Order Management forum also if you havent done so already.

Equity resale on average cost basis

In the Resale of Shares , we can select the individual deals and then resell the shares from that deal. System will calculate the Realized Gain / loss based on the individual buy and sell deal.
If we buy the same shares at different dates and at different prices, can we resale part of it and whether the system can calculate on weighted average basis of all the deal purchase instead of the individual deal ?
regards,
Charan

Hi
There are two alternative methods for initializing item average cost.
1) Use Average Cost Update to enter the item cost in total or by cost elements. This can be done manually through the form or programmatically using a custom script.
2) Use Miscellaneous Receipt transaction to enter the item quantity and its unit cost. This way you are initializing the on hand and the average cost as well. If the on hand should be zero, you may use pair of transactions. First a miscellaneous receipt transaction for quantity 1 and the proper unit price, and the second a Michele Issue transaction for the same quantity. You could load the mischievous transactions into inventory interface table.
After loading the migration transactions and on regular basis you should run the cost manager process for each inventory organization. That could be scheduled to run every few minutes, as routine.
Dina

Changing the costing method

Hello,
We are looking for approaches/feasibility in changing the costing method.
From FIFO to Average or Standard.
Oracle EBS version is 11.5.10.2.
Any pointer in this regards would be of great help.
Thanks,
Sathish

Hi,
What Nagamohan have suggested is the best solution. But take in mind the following steps need to completed for changing the costing method.
1) Create a new inventory organization with new costing method
2) Move the items & onhand quantity from old inventory org to the new inventory organization
3) Issue out the onhand quantity from old inventory organization
4) Migrate the bill of materials if any to new inventory organization.
5) Migrate the routings if any to new inventory organization
6) Take care of open Purchase Orders, Sales Orders and Jobs.
7) Modify the custom reports which is referring to the old inventory organization.
If transaction history is required that need to be migrated in addition to that.
Thanks,
Saravanan

Rollup Issue On Average Costing Method

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