Client- costing issue


One of my client asks regarding the adjustcost entries batch job.

At client place i done like what i explained below.

I created one item “DALL” . Costing method is FIFO . I done 4 purchase transactions for this item.

That is 23/01/08 qty 10 unit cost 100 total 1000

25/01/08 qty 10 unitcost 110 total 1100

28/01/08 qty 10 unitcost 120 total 1200

29/01/08 qty 10 unitcost 150 total 1500

On 31/01/01 client done a sales transaction qty 10 . But it is taking qty on 23/01/08 purchase transaction . That ‘s Ok.

But it has taken average cost instead actutal unit cost.

Then I told to client when u run the adjust cost item entries system will take actutal cost .

But my client is asking again why I need to run this adjustcost entries batch job.

Already I fixed costing method FIFO , so system has to take automatically the actual unit cost.

Client is not listening my words.

So at this time what I have to tell to convience the client.

Please throw some advise & solutions, suggestions on this to convience the client.

Thanks and regards.

This an old NAV-feature. Reason for not assigning the “correct” cost at once is to save time when posting sales/purchases.

Your example is simple, but another scenario could be when selling “some-of-this + some-of-that” (FIFO takes whatever avaliable from the first avaliable lot, the remaining from the following lots) - then you would not have only one in-cost to assign but several.

Other scenarios are selling before purchasing (qiute common!) and using Costing Method Average.

The CostAdjust-batch takes care of all this. More frequently you run the CostAdjust-batch, less timeconsuming it is.

But if you use NAV 4.0 SP1 or newer there is an option: Taka a look at Warehouse/Setup/“Inventory Setup”, tab General, field “Automatic Cost Adjust”.

When you create the sales line system automatically copy the value in Unit Cost (LCY) field of sales line from Unit cost field of item card. When you post the sales invoice or shipment it takes the same cost copied in the Unt Cost (LCY) field of sales line.

Might be this can help you understand more about how cost is captured.

Your client shouldn’t be analyzing profitablity from the Sales Order. Its rarely accurate.

[Y] how very true.

Moreover - even AFTER running Adjustment the SO contains original costing info, only Item Ledger (Value entries) are updated - you shoud never use Sales Ledger as source for any kind of COGS reporting.