Item Costs and Valuation Methods: Transactions That Record Costs in Layers

An item’s cost is recorded in a new cost layer or is updated in an existing cost layer when a batch of journal transactions containing this item is generated and posted to the Inventory account. The batch is posted on release of one of the following inventory documents:

  • Inventory receipt
  • Inventory issue
  • Adjustment
  • Transfer
  • Kit assembly or kit disassembly

The release of only inventory documents containing an item can post a batch of transactions to the Inventory account and cause the system to update the item’s cost. Each time you need to record a new or changed item cost from any area other than Inventory, an inventory document is automatically generated on release of a particular area's document (such as production order, purchase receipt, or sales invoice).

The following table lists the inventory documents that affect the cost (in the first column) and the documents whose release can generate the inventory transactions (in the second column).

Documents That Affect the Cost Source Documents and Forms
An inventory receipt on the Receipts (IN301000) form
  • A purchase receipt on the Purchase Receipts (PO302000) form
  • A transfer receipt on the Purchase Receipts form
  • An inventory receipt created directly on the Receipts (IN301000) form
  • A labor transaction on the Labor (AM301000) form
  • A move transaction for a production order on the Move (AM302000) form
  • A material transaction for by-products on the Materials (AM300000) form
  • A disassembly transaction on the Disassembly (AM301500) form
An inventory issue on the Issues (IN302000) form
  • A purchase return on the Purchase Receipts form
  • A document on the Invoices (SO303000) form
  • A shipment entered directly on the Shipments (SO302000) or generated on the Process Shipments (SO503000) form if a user clicks the Update IN command
  • A document created directly on the Invoices form if the Advanced SO Invoices feature is enabled on the Enable/Disable Features (CS100000) form
  • A material issue transaction on the Materials form
  • A material return transaction on the Materials form
  • A move transaction for a production order on the Move form
  • An inventory issue created directly on the Issues form
  • A disassembly transaction on the Disassembly form
An inventory adjustment on the Adjustments (IN303000) form
A transfer on the Transfers (IN304000) form
An assembly or disassembly on the Kit Assembly (IN307000) form An assembly or disassembly on the Kit Assembly form