Lot Tracking Specific with Avg Cost Costing Method

julia8351

Hi All :

Appreciate if anyone can explain me how the Average cost calculate with Lot Tracking Specific is turn on? I did the testing in Navision V4.1, and found the cost of the outbound transactions still base on the Normal average cost calculation instead of directly take the Lot No. cost specified.

Thank you in advance. \:D/

AdamRoue

You are average costed, so it takes the average cost. It does not, take the batch average cost, there is no costing method for this in NAV. This would be batch specific costing.

If you book Batch 1 in at 5.58, and batch 2 in at 8,36 your average will be 6.97. When you sell the item the cost will be 6.97, irrelevant to the batch you sold, because you are average costed

ara3n

you will can get the cost from specific inbound entry if you do direct application.
Nav 5.0 and greater won't include the entries in average cost calculation though.

Alex_Chow

julia8351 wrote:

Hi All :

Appreciate if anyone can explain me how the Average cost calculate with Lot Tracking Specific is turn on? I did the testing in Navision V4.1, and found the cost of the outbound transactions still base on the Normal average cost calculation instead of directly take the Lot No. cost specified.

Thank you in advance. \:D/

If this is required, then you wouldn't set your costing method to Average Cost, you would set it to Specific on your Costing Method.

AdamRoue

You cannot set the costing method to specific with lots, only serial numbers, well the last time I looked anyway

Alex_Chow

AdamRoue wrote:

You cannot set the costing method to specific with lots, only serial numbers, well the last time I looked anyway

You're right... :oops:

ayhan06

julia8351 wrote:

Hi All :

Appreciate if anyone can explain me how the Average cost calculate with Lot Tracking Specific is turn on? I did the testing in Navision V4.1, and found the cost of the outbound transactions still base on the Normal average cost calculation instead of directly take the Lot No. cost specified.

Thank you in advance. \:D/

to accomplish this, you should use "applies-to entry" field in every transaction. lot numbers are not considered in average cost calculation.but applies-to entry field is most effective way for cost calculation. (not just for average)

hope this helps.

AdamRoue

I do not disagree with the applies-to statement, and I should have included it, but first the accounts department need to be on board with this, they have chosen average for a good reason (hopefully) and secondly you need the users to be diligent and going through this additional process. I would be much happier if there was a flag that you could set to either auto-apply or not, but there is not so you are relying on the users to do this on every line for an accurate margin. The accountants I have met in this position have preferred to leave it as average so they know what they are looking at, rather than leaving it to the warehouse staff to make the application and then they have to check if this has been done if ever they see a margin they are not convinced about. It is a bit like exact cost reversing, a great idea but for some distribution companies once it is turned off the additional logistics work required instantly negates any gain financially to it gets turned off - still only my experiences, you can make NAV whatever you like, so you could always modify it

julia8351

First, thanks for promp replies

So, with the combination of Average Cost Costing method & Lots Specific Tracking, the Outbound transaction still take the average cost calculated instead of the batch unit cost, right?

Then ,how about the Average Cost Cosing method & Serial Specific Tracking combination? Does it take the same unit cost with the serial No. I select when I sales this Item? :-k

Thank you

AdamRoue

The same is true of average and serial numbers, but with serial numbers you can assign the costing method of specific, so the specific outboud cost is matched with the inbound. Or as stated, use the average and applies to.