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This article provides a process overview to help you set up and run a standard cost conversion. The steps listed are intended to be completed after you've completed the prerequisites for a standard cost conversion.
Use the Standard cost conversions page to convert the inventory model for a batch of selected items from an actual costing approach to a standard costing approach. The conversion process involves a prerequisite inventory close, several steps during a transition period, which is defined by a transition start date and a planned conversion date, and then the conversion and an associated inventory close.
After the conversion process is successfully completed, the inventory model for each item is based on standard cost, and the item’s standard cost is enabled. Subsequent inventory transactions will be valued at the item’s standard cost. In addition, the system converts the item’s physical inventory transactions for receipts and issues to standard cost based on the conversion date. The system also converts the item’s financial on-hand inventory to standard cost, and posts the difference in value as an inventory revaluation. Any transactions that occur after the conversion are valued at the item’s standard cost. You can't enter backdated transactions before the conversion date, because an inventory close must be performed one day before the conversion date. A conversion can only be performed if an inventory close was performed one day earlier. This inventory close can't be canceled.
Use the Standard cost conversions page to create a conversion record. You can create a new conversion record only when existing conversion records have been completed. The duration of the planned transition period is defined by the transition start date and the planned conversion date. A planned transition period can be as short as one day. A planned transition period helps to ensure that the conversion process has enough time to complete all its steps. An inventory close must be performed on a date that is one day before the transition start date, to help ensure that settlements are completed before you start the conversion process. To make sure that the transition start date and inventory close date are correctly aligned, you can either change the transition start date to one day after an existing inventory close or perform an inventory close. When you enter a conversion record, you also enter a user-defined identifier for a new costing version that will contain the standard costs for converted items. The costing version is generated automatically when you save the conversion record.
The new costing version is dedicated to the conversion record, as the Conversion costing type indicates. The dedicated costing version is similar to a costing version for standard costs and contains the item cost records for items that are associated with the conversion record. The dedicated costing version for a conversion record has the following settings, which you should review and modify on the various tabs as required:
Item cost information in the dedicated costing version can be maintained only from the Standard cost conversions page. You can't use the Costing version setup page or the Costing version maintenance page to calculate costs for the costing version during conversion. However, you can use these pages to maintain the dedicated costing version after you've completed the conversion process.
Use the Standard cost conversions page to identify the individual items that should be converted to standard cost. You can add multiple items by using the Add items to standard cost conversion page. In general, you should include all manufactured items in a single conversion record to help ensure that costs are calculated correctly.
Use the Item price page to enter pending standard costs in the dedicated costing version for purchased items and transfer items. Cost records are site-specific, and an item's pending costs must be entered for every site. Use the Item price page to calculate pending standard costs for manufactured items. A manufactured item's pending costs should be calculated for every manufacturing site, unless the site represents a transfer site. In this case, the pending costs should be entered manually. Some items might have color, size, or configuration product dimensions. On the Standard cost conversions page, the Use cost price by variant check box shows the standard cost for every combination of product dimensions. When this check box is cleared, you must enter only a pending cost for the item.
Use the Standard cost conversion checks report to identify issues for the items that are being converted. If an item doesn't have any issues, its status in the conversion record is changed to Checked. If an item has issues, you must resolve the issues and then run the report again until the item's status is changed to Checked. If you can't resolve an item's issues in a timely manner, you can optionally delete the item from the conversion record and then convert the item later.
When the status of the conversion record is changed to Ready, the system performs a final check before it runs a standard cost conversion. The status is changed to Ready only if the following conditions have been met:
The backup lets you restore the database if errors are encountered during the conversion.
The conversion process requires that an inventory close be performed on a date that is one day before the planned conversion date. This requirement helps ensure that back-dated transactions can't be entered during the transition period. If an inventory close hasn't yet been performed, you'll be asked if you want to perform it as part of the conversion process. The conversion process handles one item at a time. It starts with the lowest items in a product structure, based on the item's low-level code. When an item has been successfully converted, its status in the conversion record is changed to Converted. If the conversion process is interrupted, any items that haven't been successfully converted will still have a status of Checked. Successful completion of the conversion process has the following effects:
The Variance analysis statement report lets you analyze revaluation variance and the Inventory value report lets you view inventory value on a specific date.
Events
Power BI DataViz World Championships
Feb 14, 4 PM - Mar 31, 4 PM
With 4 chances to enter, you could win a conference package and make it to the LIVE Grand Finale in Las Vegas
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Set up and work with inventory control in Dynamics 365 Supply Chain Management - Training
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