I have a bizzare case. We manufactured an item, and the cost of the final inventory in the finished goods account is larger than the sum of all the consumption and capacity. Unless a user changes the cost that populates on the output journal line (which we don’t believe was done) then the cost should equal the sum of all consumption and capacity.
At first I thought that some consumption or capacity might have been posted with a wrong dimension, but I confirmed all entries for the production orders relevant were correct.
I know the info is sketchy, but was just hoping for any pointers on how else the output cost could become “bloated”…?
when an item is outputted, it use the cost as stated in item card.
if your costing method is standard, so it use standard cost to increase your inventory account, and decrease your w.i.p. account.
if this is the case, you need to evaluate your standard cost.
Many thanks Jo.
This item is using average costing (sorry forgot to mention that), and this output entry was the first transaction ever for the item. Would it not then be taking the cost of consumption + capacity as the cost to be output to?
Only once it is set to finished and the ACIE routine is run, until that point the true cost is not known, so the item card cost is used. The ACIE will adjust all of the entry values when run.