LIFO and FIFO Costing Setup
Use these steps to implement either LIFO or FIFO inventory cost method:
- Select the Post to Journal check box on the General Parameters form to have all transactions which affect inventory post to the G/L inventory distribution journal. Clear the check box to suppress posting to the G/L those transactions which may affect inventory.
- Set the Cost Method field on the Items form General tab to LIFO or FIFO for all items. (Ideally, you would set this field at the time the items are added to the Items file).
- Set the Cost Type field on the Items form General tab to Actual. The cost type default value comes from the Cost Type field on the Inventory Parameters form when adding new items.
- Specify the initial cost for the item into the Unit Cost field in the Items form at the time the item is added to the file.
If you specified Actual in the Cost Type field, and selected the Post to Journal check box to indicate that the manufacturing modules are to post inventory transactions to G/L, you must also set up the G/L account numbers that are used for this interface. Listings of the account numbers and related codes and parameters that must be entered for costing purposes follow.
Product Codes - WIP Tab
WIP Material
WIP Labor
WIP Fixed Overhead
WIP Var. Overhead
WIP Outside Services
Product Codes - Miscellaneous Tab
Inventory Adjustment
Product Codes - Applied Overhead Tab
Matl Fovhd Applied
Matl VOvhd Applied
Departments
Fixed Ovhd Applied Acct
Variable Ovhd Applied Acct
Direct Labor Applied Acct
Work Centers - Costing Tab
Fix Mach Ovhd Applied Acct
Var Mach Ovh Applied Acct
Distribution Accounts - Inventory Tab
Inventory Material
Inventory Labor
Inventory Fovhd
Inventory Vovhd
Inventory Outside
Distribution Accounts - Sales/COGS Tab
COGS Material
COGS Labor
COGS Fovhd
COGS Vovhd
COGS Outside
Distribution Accounts - In-Transit
In-Transit Material
In-Transit Labor
In-Transit Fovhd
In-Transit Vovhd
In-Transit Outside