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Using FERT as trading good....

Former Member
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Hi,

Plz tell me is it possible to use material of FERT type as trading good i.e. for sales.

The scenario is a material (FERT)is produced in house and after it become finished good it transfer to different plants and than consider as trading product for sales. MRP 2 view is maintained as X, Price Ctrl=S, sales view also maintained. The problem is in price valuation, what will be the logic for material valuation. Is this a good practice to maintain sales view of FERT type and use same mat. for sales and distribution or we should create another material with HAWA type.

If 2nd option is valid, than it means if company has 100 finished matrl. than there must be 100 HAWA trading goods.

I want to use FERT for the in house stock transfer as well as for Sales purpose, how...

regards,

Man

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Answers (1)

Answers (1)

Former Member
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In my opinion is you can go for split valuation for the particular material type. so that we can control the price indicator whether its standanrd price or moving average price. Whenever you procure from external that price will add to the material cost.

For internal material you have standard price so need to worry about that. Moreover this split valuation is nothing but batch. we can easily differentiate the materials.

Former Member
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Hi,

Is this the standard practice to maintain FERT as finished good and for trading goods at the same time by split valuation.

What r the drawbacks if we use same (1) G/L account for stock update as well as for trading goods i.e without split valuaton, however both are valuated by standard price only the difference is the G\L account. No doubt we can use split valuation but plz tell me the consequences we can face for such material.

Former Member
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See normally trading goods means we will procure and sell, in this case how you can have the standard price. Depends upon the market this rates will be changed frequently. If you have standard price any price hike is there it will go and hit in the price difference GL.

thats the reason i told you go for split valuation. For trading goods you will have separte val class and GL and price indicator will be V. so whenever any price changes is there it will get inventorized.

For finished goods you will have standard price. for this you can have a Price indicatore S.

Normally this is based on the client it will varry.If the client is dont want to create too many materials you can go for this one. Otherwise you can go for trading goods material type.

Former Member
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Hi,

Ur description is right, client requirement is Finished product is valuated by Standard price but for stock G/L account is 796000 and for revenue from sales G/L account is 310000. Will it be the right option to go for split valuation or we should create one material for stock purpose and another for sale ( which seems illogical for me). What is the standard practice, any feedback from consultant...