IPV Amount On Partial PO Quantity Is Prorated To Entire Receipt Quantityin Cost Accounting as Acquisition Cost Adjustment

(Doc ID 2342592.1)

Last updated on DECEMBER 22, 2017

Applies to:

Oracle Fusion Cost Management Cloud Service - Version 11.12.1.0.0 and later
Information in this document applies to any platform.

Goal

IPV amount on partial PO quantity is prorated to entire receipt quantity in cost accounting as acquisition cost adjustment .

The invoice and receipt accounting both created IPV at 4100 = ( 50x ( 200-118) ) for 50 tons @ 200$ price ( orginal PO price is $118 )
But on Cost accounting the value of the acquisition cost adjustment is 1400

Cost Accounting-accounted at 11/8/2017:

Debit: 10250 - Inventory valuation $1,404.18
Credit: 10260 - Receiving inspection $1,404.18

Total IPV amount on invoice is $4,100 ($82 unit variance for 50 tons), we suppose it is allocated on 50 tons that we specified in
invoice line, but when it comes to cost accounting, the total variances got equally allocated on total quantity of PO line, which is
31,129.042 tons, makes the unit IPV = $0.13137. And this IPV got propagated on all completed transactions, eg: PO receipt
quantity 10,661.15, return quantity -1,000.

The IPV is adjusted on the entire unit cost of the PO, there by reducing the impact of the price change

Cost method is actual , with propagate IPV checked on the cost profile.

https://orioniss.us.oracle.com/iss/faces/issviewer/home?context=SR&contextNum=3-16237367341&file=Issue_on__Acquisition_Cost_Adjustment.docx
 

Solution

Sign In with your My Oracle Support account

Don't have a My Oracle Support account? Click to get started

My Oracle Support provides customers with access to over a
Million Knowledge Articles and hundreds of Community platforms