Does anybody ever use Serial/Batch Valuation Method?
I forgot to attach the image.
This is done now.
Hope this can encourage readers to answer me. :)
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Hello, everybody
SAP B1 introduced the Serial/Batch Valuation Method (S/BVM) since version 9.1. Previously, there were only 3 valuation methods in SAP B1: FIFO, Average and Standard Costs.
I intend using S/BVM in my company, but I don’t understand the logic of S/BVM at all. It seems so weird. I hope someone can shed some light.
In one SAP publication, I read:
The 2 main benefits of S/BVM are:
- The cost used for an item in outbound transactions is the actual inbound cost of that specific batch.
- Hence, profitability can be calculated for a specific batch.
Fine! But when I look at the examples given, they seem to contradict these principles.
The following example is from the How-to Guide “How to Set up and Use Serial/Batch Valuation Method in SAP Business One” – page 35
Calculating Costs for Goods Receipt PO Priced at Zero
Assume: Do not block multiple receipts for the same batch
Actually, GRPO 2 represents 10 items received at 0 price.
But whenever goods are received at a price different from the current cost, this triggers a cost recalculation.
I assume you are familiar with the calculations. I have omitted the details.
So, GRPO 2 is received at $ 0 cost, but SAP recalculates it to 10 x $2.5 = $ 25.
SAP calls the $ 25 the transaction value of the GRPO (the actual value = 0).
I really don’t understand this:
Total inbound costs = 100 + 0 = 100
Total outbound costs = 50 + 75 = 125
So, Inbound <> Outbound, which means that goods received at $100 are issued at $ 125. Weird, very weird!
The Guide explains that the difference of $25 is posted to the Price Difference A/c.
The Guide also recommends to Block multiple receipts for the same batch in order to avoid these weird results!
But why?
- For what reason does SAP recalculate the GRPO value from 0 to 25?
- SAP also recalculates the batch cost (the cost of the closing stock) as: Total Value of all RECEIPTS / Total Qty of all RECEIPTS.
- Why does SAP permit goods to be received at $ 100, but issued at $ 125?
- What objectives are SAP trying to achieve through S/BVM?
Kindly enlighten my confused mind.
Thanks
Leon
