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inventory valuation

Former Member
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We have following situation:

When the PO is created the Freaight cost is unknown. We are using Moving Average for inventory.After the GR and invoice receipt have been completed, we receive, additional freight invoice. Based on this invoice, by using, credit/debit memo functionality we can assign the cost to the inventory of the article that is still in DC. Meaning, original PO had qty of 100, but by the time the freight invoice came in some of the original qty of 100 is ( ie 80) is gone from DC. The freght cost would be divided over the remaining qty of 20.

The question is what happens when the freight invoice shows up after all of oroginal qty of 100 is gone? Where does this cost get assigned to? Shouls there be some kind of G/L account set up to handle this? and if there was an account how does this cost get assigned to article later>

Need help.



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Answers (3)

Answers (3)

Former Member
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You can put approx amount in freight condition type.

then while passing miro for delivery cost you can pass the actual value and rest is to be debited to unplanned delivery cost.

This will help in correct valuation.



Former Member
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If the quantity of the subsequent debit(Freight cost) is smaller than or the same as the quantity delivered, the system tries to post the subsequent debit to the stock account. If the material is valuated with a standard price or if there is insufficient stock coverage for the quantity to be debited or credited, the amount is posted to a price difference account.

As you asked you can assign new GL account for this purpose. If you assign New GL account in PRD, whenever there is Price diff is there it will hit tht GL account which is not correct.

You hve to freight cost as Subsequen debit or as planned delivery costs.



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Former Member
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If the freight is getting posted to the material account & stock availability is not present at the time of invoice then the Price Difference Account maintained in PRD transaction key will be hit.

Thanks & Regards