How to avoid opening stock price difference from being posted to manufactured sales order stock

[sanjay_ram]

Hi,

I am trying to find a way to avoid opening stock price differences from being posted to the consumption of current period by manufactured sales order stock in Sales order costing scenario. Eg :-

Initial Stock

Raw Material : ABC

Standard price : 20

Opening Stock Qty : 1

Opening Stock Actual Price : 30

Opening Stock Price Difference : 30 - 20 = 10

Finished Product : ZZZ

Standard price : 17

New Purchases

Purchase order price : 25

Purchase order qty : 1

Goods receipt qty from purchase order into inventory : 1

Goods receipt price difference = 25 - 20 = 5

Consumption In Production

Production order P001 for FG ZZZ linked to sales order S1

Goods issue of ABC for 1 qty to production order valuated at standard price of 20

Goods Receipt From Production

GR of ZZZ for 1 unit valuated at 17

Manufacturing variance 20 - 17 = 3

After Material Ledger Execution

Actual price for Raw material : ABC is computed as follows :-

Op. stock price diff 10 + GR price difference 5 = 15

The total price difference of 15 will be divided between consumption of 1 unit and closing stock of 1 unit at 7.5 each (15 / 2), bringing the actual price of ABC to 20 + 7.5 = 27.5

So the sales order stock ZZZ manufactured by production order above will be revaluated to 17 + 7.5 + 3 = 27.5

In this example above, the current period raw material price difference is added up to the opening stock price difference and then posted to the manufactured product.

However is there a way to avoid this averaging of price difference and post only the current period price difference to the manufactured product? The requirement is like this :-

Instead of summing up Op. stock price diff 10 + GR price difference 5 = 15, the system should separate and allocate only the current period price difference to the consumption of production order and the opening stock price difference should go to the ending inventory like this :-

5 goes to production order

10 goes to ending inventory

So the final value of production order will be :- 17 + 5 + 3 = 25 instead of 27.5

I know the standard system cannot do this, is there an alternative work around to achieve the above?

[former_member219086]

Hi Sanjay, I can also see the only option is to play around with MR22 to adjust the price differences accordingly.

If MR22 feasible solution for you, you can try exploring the option of customizing MR22 to adjust the opening price differences before ML close (10 credit) and repost the same (10 debit) to next period after ML close automatically.

Regards,

Srinath

[coleti]

Dear Sanjay,

Your need is strange for me, but I see to possible solution for this issue. I will consider that your PrDiff of 10,00 that should be included in the End Inventory one day have to be consumed high ? Maybe next period.

I see two possible solutions without customizing:

1st ) Post your opening balance actual cost with the same standard cost (20,00) and then in the next period you adjust the actual cost debiting the material in 10,00 using MR22.

2nd) You can post your opening balance actual cost with 30,00 and credit 10,00 using MR22, and then in the next period debit 10,00 using the same MR22.

I think you can work with MR22 to manage the costs of your material.

Best regards,

Gabriel Coleti

[sanjay_ram]

Dear Gabriel & Srinath,

Thanks for that. Will try that. However how about another alternative where for the new purchases of ABC we capture them under a dummy sales order and keep it there as the sales order stock.

Then during production we post the stocks from the dummy sales order to the production order. In this way only the current period price difference will flow into production order and the opening stock price difference will be posted to the ending inventory of ABC.