Sales Profitability

jacky10

hi

consider this scenario...
A Sales Order is raised for an Item X.. It is new, so the average cost is obviously zero.

based on that requirement, the purchase department raises a PO and SRV is made but not invoiced due to the delay in getting the invoice from suppliers..

now by mistake if that sales order is executed (i.e Shippd and Invoiced) my sales profitability shows 100% because the cost at that time of SO creation was zero..

now how to solve this issue?... wud appreciate ur guidance....

AdamRoue

Use expected cost posting and put in a cost around the cost you will post. It is not really an issue as the costs flow through, but you need to control your process.

Alex_Chow

When the purchase receipt is posted, you'll get the expected cost when you drill down to the item ledger and value entry.

This is of course after you run the Adjust Cost - Item Entries process.

jacky10

agreed... but the Sales Order is Booked before the SRV or Purchase Invoice is made.. so the cost in SO is zero...

AdamRoue

Because you have set the system to do this, if you had not had a zero cost on the item it would have taken the cost specified as expected.

David_Singleton

You will always get this problem when using the costing method GIGO :shock: . You need to change to a different costing method

Alex_Chow

jacky10 wrote:

agreed... but the Sales Order is Booked before the SRV or Purchase Invoice is made.. so the cost in SO is zero...

The problem has been discussed on this forums before. There has been a lot of responses to your question. Try seaching.