Example: Landed Cost Standard Costing

This topic provides a costing example.

In the following example, the quantity used is 200.

Part Number jw-lc

Costs Standard Current
Material $4.00 $4.00
Duty $0.50 $0.50
Freight $0.25 $0.25
Brokerage $0.10 $0.10
Insurance $0.10 $0.10
Local Freight $0.10 $0.10
Totals $5.05 $5.05

Vendor 2 jw-lc

Qty Break Material Cost
100.00 $4.00
200.00 $3.75
300.00 $3.50
400.00 $3.25
500.00 $3.00
Receiving Debit Credit
Inventory $5.05  
Vouchers Payable   $3.75
Duty Payable   $0.50
Freight Payable   $0.25
Brokerage   $0.10
     
Insurance Payable   $0.10
     
Local Freight Payable   $0.10
Purchase Price Variance   $0.25
     

Create Voucher from PO:

Voucher Distribution Totals    
Duty $0.55 Expense is $0.05 more than receiving
Freight $0.20 Expense is $0.05 less than receiving
Brokerage $0.15 Expense is $0.05 more than receiving
Voucher Distribution Debit Credit
Duty Variance $10.00  
Duty Payable   $10.00
Freight Variance   $10.00
Freight Payable $10.00  
Brokerage Variance $10.00  
Brokerage Payable   $10.00
Voucher Posting

(Additional Expense x Qty)

Debit Credit
Accounts Payable   $970 (4.85 x 200)
Brokerage Payable $30 (0.15 x 200)  
Duties Payable $110 (0.55 x 200)  
Freight Payable $40 (0.20 x 200)  
Insurance Payable $20 (0.10 x 200)  
Local Freight Payable $20 (0.10 x 200)  
Vouchers Payable $750 (3.75 x 200)