Purchase Price Variance Reversal

engsiong75

Hi

I have a customer who is using Standard Cost. One of the headache which the users have is when an item is purchase with a price higher than their standard cost. The difference will be posted to the Purchase Price Variance. So far navision handles it well. However, when they return the goods, they want the Purchase Price Variance to be reversed.

I can think of the logic how this can be done. First get the program to calculate what the exact Purchase Price Variance was for the quantity of goods to be returned to Vendor. Input the Purchase Price Variance into a Purchase Credit Memo as a charge item. I will have to take in to consideration of the exchange rate as well. I will then post the Purchase Credit Memo as well as the item quantity returned as well as an offset entry for the Purchase account.

Debit Purchase
Credit Purchase Price Variance.

Question:
1) Has anyone build such a funtion before?
2) What are the risk involved?
3) What other solutions does anyone have besides using Charge Item?

Thank you,

Tan Eng Siong

jannestig

Have you looked at the purchase setup "exact cost reversal" sounds exactly what you are looking for.

Help description is below

A check mark in this field indicates that the program will not allow a return transaction to be posted unless the Appl.-to Item Entry field on the purchase order line contains an entry.

This function is used when the company wants to apply an exact cost reversing policy in connection with purchase returns. This means that the purchase return is valued at exactly the same cost as the original purchase when being drawn from inventory. If an additional cost is later added to the original purchase, the program updates the value of the purchase return respectively.

engsiong75

Hi

Exact cost reversing does not work. We are using Standard cost. The exact cost is net of the Purchase Price Varaince.

Any better ideas?

Tan Eng Siong