Item Costing Setup

This feature allows you to set the parameters that determine the calculation criteria used in the valuation of items.

To open the page:

1. In Search type Item Costing Setup, then click on the related link.

Below you can find the list of fields:

• Fiscal Inventory Valuation: Method to be used for tax valuation. It is possible to choose between the following options:

  • Item

  • LIFO Category

• Production Cost Calculation: it is used to define the parameters for the calculation of production costs. It is possible to choose between the following options:

  • Standard Routing/BOM: the calculation will be made taking into consideration the actual costs for the components and the actual/standard costs for the phases (see setup Capacity Cost Calculation), but with standard times and consumption.

  • Actual Entries: in this case, everything is reported with the actual production entries.

• BOM/Routing Reference Date: allows you to define the validity date of the BOM and routing versions with which to calculate the production costs, if at the beginning of the period and at the end of the period.

• BOM/Routing Status: defines whether to take all the BOMs/routings in the calculation, or to take only the certified ones.

• Purch. Items Valuation: a purchase item is calculated considering the average operating cost or the weighted average cost of its purchase components.

• Average Cost,Weighed Average Cost: a production item is calculated considering the average operating cost or the weighted average cost of its semi-finished products.

• Weighed Average Cost Calculation: it can be Fiscal Method or Civil Low Method. In terms of data, the difference is summarized in the following formulas:

  • Fiscal Method = (GI x CMP + (GF – GI) x CM) / GF

  • Civil Low Method = (GI x CMP + PA x CM) / (GI + PA)

Caption
GI	initial inventory
GF	final inventory
PA	progressive purchases
CMP	weighted average cost of the previous year
CM	medium term cost

• WAC Calc. Use Same Setup: if active, the previous period on which to base the evaluation of the initial inventory in the calculation of the weighted average cost is searched by filtering by item cost setup code. Alternatively, the previous fiscal period is searched.

• Continuous FIFO Cost: if active the continuous FIFO cost is calculated on the item.

• Continuous LIFO Cost: if active the continuous LIFO cost is calculated on the item.

• Estimated WIP Consumption: if active, the consumption of production orders is valued by competence, while in the opposite case they are valued by posting date.

• Allow Additional Costs: if active enables the management of additional costs

• Skip Job Entries: if active, the entries, both item ledger and capacity, which refer to the jobs, are excluded from the valuation. This feature is useful if these entries are already included in the job order evaluation. Normally the flag is activated in the presence of verticals specialized in jobs management.

• Variant Cost Calculation: allows you to enable cost calculation by variant. Possible values:

  • Blank = calculation unabled
  • Item enabled: calculation made for items that have the Cost Management Type field = Variant in the linked Product Family
  • All items: all items are managed by variant.

• Item Specific Cost Calc.: defines the cost calculation methods. Possible values:

  • Amounts: the unit cost of the item is calculated as progressive purchases by value / progressive purchases by quantity.
  • Inventory: the unit cost of the item is calculated as the sum of the values ​​of the variants in inventory / inventory.

• Capacity Cost Calculation: defines the procedures for enhancing capacity entries. Possible values:

  • Entry Actual Cost: the entry is valued with its actual cost (provisional or definitive)
  • Standard Cost: the entry is valued using the standard cost of the area / center of movement as unit cost
  • Actual Cost: the entry is valued using the actual cost of the area / center of movement as unit cost
  • Production Area Price List: the entry is valued using the unit cost taken from the price list of the entry production area

• Subc. Standard Cost Priority 1: defines the procedures for valuing subcontracting movements. Possible values:

  • Actual Entries: the entry is valued with its actual cost (provisional or definitive)
  • Routing Line: the entry is valued using the cost taken from the routing phase as the unit cost
  • Subcontracting Prices: the entry is valued using the cost taken from the subcontracting list as the unit cost

• Subc. Standard Cost Priority 2: defines the procedures for valuing subcontracting entries. It has the same values ​​as the previous field and is used if the valuation with the previous method does not obtain a valid cost.

• Subc. Standard Cost Priority 3: defines the procedures for valuing subcontracting entries. It has the same values ​​as the previous field and is used if the valuation with the previous method does not obtain a valid cost.

• Custom Calculation Codeunit (start): with this parameter it is possible to hook a custom calculation function, activated once at the beginning of the period calculation. The codeunit has the period as its parameter record.

• Custom Calculation Codeunit (item): with this parameter it is possible to hook a custom calculation function, activated at the beginning of the calculation of the single item. The codeunit has the item history as its parameter record.

• Cost integration source code: specifies the source code used in cost integration entries.

A second set of parameters controls the rollup mechanism by cost type:

• Cost Type Rollup Enabled: if it is true enables the Cost Type Rollup feature

• Material Cost Type Rollup: if it is true enables the Material Cost Type Rollup feature

• Mat. Default Add. Cost Code: additional cost code to which add discrepancies on the Material Cost Type Rollup

• Capacity Cost Type Rollup: if it is true enables the Capacity Cost Type Rollup feature

• Cap. Default Add. Cost Code: additional cost code to which add discrepancies on the Capacity Cost Type Rollup

• Subcontr. Cost Type Rollup: if it is true enables the Subcontr. Cost Type Rollup feature

• Subc. Default Add. Cost Code: additional cost code to which add discrepancies on the Subcontr. Cost Type Rollup

• Custom Calculation Codeunit Cost Type Rollup: with this parameter it is possible to hook a custom calculation function, designed to generate the atomic data of the Cost Type Rollup. The codeunit has the item history as its parameter record.