How to maintain the item cost price

We can configure three kinds of price information for a specific item on the “released product details” form.

I have two kinds of items as below:

Item(1): this one will be purchased by “purchase price” and be sold by another “sales price”.

Item(2): this one will be purchased by “purchase price” and used as part of the BOM. (we have to take the cost into account)

  1. For those two items, do i have to maintain the cost price for them?

  2. If we have to, how to get the cost price?

(Sorry for that i cannot find any official document for this)
Many thanks

please note that cost price will be automatically picked by the system based on the costing method of the product. For example, we received two quantity from 2 different POs. First item has been purchased at 50 USD and second item is purchase at 60 USD.

when this item is used to produce a BOM and for example the costing method of this item is (FIFO), system considers the cost as 50 USD. If costing method (LIFO) is followed, this item’s cost will be considered as 60 USD. (Initially it will be running average cost that system uses, but ultimately when an Inventory close is performed it picks the cost based on the costing method - you can ignore this point for now) You can use this article for some understanding.

  1. So, you don’t need maintain the cost of item unless you wanted to use a standard cost for an item.(you can refer TechNet for more information on standard costing)

  2. I believe you understand how the cost price will be picked based on my above comment.

You can try this:

  • Create two POs, Quantity 1 in each PO

-Create a Sales order and Invoice it and go to inventory transactions and see the cost amount gets automatically updated based on your receipts.

Ultimately there is no insistence on maintaining the cost of the item - this is not ERP specific, you want to zero cost items you can (you may struggle with margin reporting!). Purchased or Manufactured I would recommend you maintain a cost to accurately reflect the cost of your inventory. Buy an item for $100, it is valued at $100 and consumed at $100 (lots of if’s here) and you can track it. Maintain the costs of how much the vendor tells you it will be, and how much value add you put in if you transform it into another item - these are usually the basis for any selling price to then make a profit.