Actual costing for receipt postings in manufacturing
You can use actual costing in Manufacturing when the item's inventory valuation method is defined as LIFO, FIFO, MAUC, or lot controlled in the Item Data by Warehouse (whwmd2510m000) session, and the End Item Receipt Posting check box is selected in Production Order Parameters (tisfc0100s000) session. For information on how costing is performed when the End Item Receipt Posting check box cleared, refer to Standard costing for receipt postings in manufacturing.
For actual costing to work accurately, procedures must be defined that regulate the timely booking of costs. These are used in case operations or specific quantities on a production order are reported Completed while not all costs have been booked.
Correction factors must be defined that are applied in case of partial deliveries to distribute costs using the following methods:
- Correction for costs of completed but not yet received quantities
- Correction for high progress operations
- Correction for setup costs
- Correction for issued materials
If you use backflushing, this must be performed manually before quantities are reported complete in the Report Orders Completed (tisfc0520m000) session.
Otherwise, backflushing is performed after the end item is received in the warehouse, and the backflushed costs are not taken into account when the standard cost for the end item is calculated. For more information, refer to Actual costing and backflushing
Receiving production order items in a warehouse differs depending on the properties of both the warehouse and production order:
Receiving in warehouse with Standard Cost as the valuation method
The difference between the actuals and standard cost is booked with a standard cost result and the end item is received in the warehouse at standard cost value. Note: this is not allowed when project pegging is implemented.
Receiving in warehouse with actual costing
In this scenario no variances should occur. The end item is received against the value it was produced at.