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author's profile photo Former Member
Former Member

Cost estimate

Dear experts

we have a problem with our PPC department,we are following standard costing method for our inhouse semifinished produced goods,suppose we run a cost estimate for current month, & we estimted the price of Material at 150Rs,

Suppose in next month production the component price has come down & total cost estimate value is recosted at 120Rs.

So we are asking our planning dept to close POs for previous month & create fresh POs after running new cost estimate for current month.

But our planning department is not agrreing to it,they are telling they will not create fresh POs,they will continue with OLd pos.

If they continue with old pos we will not be able to get revised Prices for material codes,how to solve this problem.

Regards

Sandeep patil

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2 Answers

  • author's profile photo Former Member
    Former Member
    Posted on Jul 04, 2008 at 08:22 AM

    Hi Snadeep,

    I really could not understand what is the relevance of PO price with the cost estimate. We pick the prices from Material info record or Material Master.

    If we change the valuation strategy to only values from Material master, then problem is solved.

    I hope you understand the point.

    Award points suitably

    Best Regards

    Surya

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  • author's profile photo Former Member
    Former Member
    Posted on Jul 04, 2008 at 10:05 AM

    Hi Friend,

    As you can convince your Purchase department to change the PO line item if they are not ready to make the new POs. We you will make the GR accordingly new prices will be fetched for raw materials and relevant costing will be done for the same material.

    Of course you can change the line item for POs taking prior approval of purchase department.

    I hope you understood.

    Regards,

    Jigar

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