Cost management
Cost management in Supply Chain Management lets you work with the valuation and accounting of raw materials, semi-finished goods, finished goods, and work-in-progress assets. It is the process of defining, managing, and reporting inventory accounting and manufacturing accounting.
You can define cost policies in the following areas:
- Predetermined cost
- Inventory accounting
- Manufacturing accounting
- Indirect cost accounting
- Ledger integration
For example, you can define which inventory valuation methods, such as (FIFO (First in, First out), (LIFO (Last in, First out), (LIFO date (Last in, First out Date), Weighted average, standard cost, or moving average that you want to apply to products in the item model group in inventory accounting.
You can access inventory accounting and manufacturing accounting from the Cost administration and Cost analysis workspaces. These workspaces provide a comprehensive overview of the current status, KPIs, and detection of deviation.
Manufacturing accounting lets you handle job order costing in production orders and batch orders, in addition to backflush costing in lean manufacturing.
The cost management Power BI content provides managerial insight into inventory and work-in-progress (WIP) inventory and how cost flows through them by category over time. The information can also be used as a detailed supplement to the financial statement.