Actual Cost adjustment allows us to adjust the final calculated cost of a raw material or product based on quantity and unit cost.
Navigation:
OPM Financials > Actual costs > Adjustments
Enter the Item for which the cost should be adjusted. This may be a raw material, co-products, by-product, intermediate, or product.
Enter the Cost Calendar to which the adjusted actual costs for the item will be updated.
Enter a Period within the cost calendar to which the adjusted actual costs for the item will be updated.
Cost Type must be an actual cost type.
Item cost field will display the current cost of the Item.
Actual Cost Adjustment Details:
The Actual Cost Adjustment supports three adjustment types,
Average Cost adjustment
Value Cost adjustment
Unit cost adjustment
Average Cost Adjustment:
The Average Cost Adjustment type lets us to enter a quantity and a cost. This adjustment simulates a transaction that happened outside the OPM Actual Cost process. For example, if you use a third party system to record transactions, then use this adjustment type to replicate the event to include in cost calculations. The Actual Cost process considers these transactions similar to a purchase order receipt.
(Prior Qty * Prior cost) + Sum of (Receipt qty * PO price) + Average cost adjustments
New unit cost = --------------------------------------------------------------------------------------------------------
(Prior Qty + Sum of Receipt Qty + Sum of average Cost adjustment Qty)
Value Cost Adjustment:
The Value Cost adjustment allows us to enter an adjustment value without quantity. The value entered will be considered for the entire quantity.
(Prior Qty * Prior cost) + Sum of (Receipt qty * PO price) + Value adjustments
New unit cost = -------------------------------------------------------------------------------------------------
(Prior Qty + Sum of Receipt Qty)
Unit Cost Adjustment:
Unit Cost Adjustment type lets us to adjust the actual unit cost of the item with the specified cost. The Actual Cost process calculates the cost of the item as per the current logic and then applies this unit cost adjustment to calculate the new adjusted cost. This adjusted cost becomes the new actual cost of the item.
First the New unit cost (without the Unit cost adjustment) is calculated as follows,
(Prior Qty * Prior cost) + Sum of (Receipt qty * PO price) +
New unit cost Value adjustments + Average Cost adjustments
(without Unit Cost = ---------------------------------------------------------------------------------------
Adjustments) (Prior Qty + Sum of Receipt Qty + Sum of Average Cost adjustment Qty
The Unit Cost Adjustment is included only after the Actual Cost is calculated based on the existing Adjustment types. Then, the New Unit Cost (with the Unit Cost Adjustment) is calculated as follows,
New unit cost (with Unit Cost Adjustments) = New unit cost (without unit cost adjustments) + Unit cost Adjustments
After selecting the type enter the Component Class code being adjusted. To know about defining Component Class click the following link
Enter the Analysis Code to further define the specific adjustment. To know about defining Analysis code click the following link
http://dj-oracleapps.blogspot.in/2014/07/defining-cost-analysis-codes-in-oracle.html
Enter Quantity of the item, if the type is Average Cost Adjustment.
Enter the Unit of Measure in which the specified item's actual costs are being adjusted in UOM. This can be any unit of measure that can be converted to the item's unit of measure.
Specify the new Unit Cost for the item in this inventory organization, calendar and period.
Enter the Reason Code that defines the reason behind the actual cost adjustment you are making. To know how to define Reason Code’s click the following link,
Click the Subledger Entry to choose whether a subledger entry should be created for the adjustment.
Note:
Based on the Reason Code selected, the Subledger Entry defaults what was selected for the adjustment reason code. For example, if the specified adjustment reason code was selected as a reason code with the Subledger Entry option enabled on the Actual Cost Adjustment Codes window, then this field is automatically enabled.
GL Date Indicates the GL transaction date used by the Accounting process for creating accounting entries for adjustments. If the Subledger Entry option is selected, then the GL Date is enabled and defaults to the start date of the selected calendar and period. If the Subledger Entry option is not selected, then the GL Date is disabled and the date is set to Null.
One of the following three statuses of the costing adjustment displays automatically in Adjustment Status,
Not Applied - This is the initial status applied to the adjustments
Applied - This indicates that the adjustments have been "picked up" by the Actual Costing process and have been used in the cost calculation.
Modified - This indicates that the adjustments have been modified after they have been applied to actual costs.
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