Inventory Costing

You can use Inventory Analysis to perform these analyses:

  • Inventory variance posting

    The difference between the valuation amount that is recorded after the receipt of goods and the updated value for that particular receipt. Processing of inventory variances results in financial transactions that clear the interim variance account, and if possible assign the variance to inventory.

    An inventory variance can be created under these conditions:

    • Receipt price is changed after the receipt is confirmed.
    • Invoice price differs from the receipt price.
    • Production order is closed and the actual cost price differs from the estimated cost.
  • Inventory valuation

    You can use different valuation methods in LN such as Fixed Transfer Price (FTP), Moving-Average Unit Cost (MAUC) to perform inventory valuation. Each valuation method results in a particular inventory value in the ledger. The value in the ledger does not always represent the real value of the inventory.

  • Moving Average Unit Cost (MAUC)

    Moving-Average Unit Cost (MAUC) is an inventory valuation method that is used for accounting purposes. The MAUC is the average value for each unit of the current inventory. Inventory is valued against the average receipt price. For each new receipt, the MAUC is updated. To calculate the inventory value for an item, the MAUC inventory valuation method uses all types of transactions. MAUC is the financial method for inventory valuation.

  • Inventory value
    • You can view the bar chart for inventory values by warehouse or by item group for a specific warehouse using the Inventory Value (whina8351m000) context application.
  • Inventory turns
    • You can view the bar chart for inventory turns by warehouse or by item group for a specific warehouse using the Inventory Turns (whina8353m000) context application.