Inventory costs for sales return notes

This topic describes the impact on receipt costs and item costs when a sales return note is created and processed. The inventory costing principles related to sales return notes is no different to that used elsewhere within the system.

When processing a sales return note, a movement order is created with a receipt movement type. This is based on the movement type defined in the SRN type. Each movement order line creates a receipt record. The normal inventory costing principles related to movement orders of the receipt type are applied.

When entering and processing an SRN, value labels are associated to the SRN via the sales type. These can be used to derive the values for the value labels, or the values can be copied across from the original transaction, or you can manually enter or override values.

Value labels on the SRN are transferred to the movement order value labels. The movement order value labels can then be used for costing. When the receipt is actualised, the latest and weighted average costs are calculated and applied to the item costs. These two costs plus the standard cost, the defined average cost and any user defined costs are appended to the receipt record.

The costs can be broken down into cost types. For each combination of currency and cost type, all standard, defined average, latest, weight average and user defined costs are recorded.

The cost values used to update these costs are derived at the sales return note entry stage. You can change the cost values at the sales return note entry stage or the sales return note confirmation stage.

Standard costs are always derived from the current standard cost on the item master record.

If you are using an existing invoice or order the cost values are copied from the original line onto the return note line. You can amend the derived cost if required.

If you are creating a return note from scratch, the system derives the cost value for the item from the item cost record. You can amend the derived cost if required.

When the system updates the inventory, the receipt and item costs are updated.