How PAC considers LCM charges in item cost calculation (Doc ID 1957558.1)

Last updated on JANUARY 13, 2017

Applies to:

Oracle Cost Management - Version 12.1.3 and later
Information in this document applies to any platform.

Goal

We have LCM enabled organizations and we need to know how PAC considers LCM charges in item cost calculation.
Item cost is calculated like the following: (TOTAL_LAYER_QUANTITY of previous accounting period * ITEM_COST of the previous accounting period + BUY_QUANTITY of the current accounting period * ITEM_BUY_COST of the current accounting period + MAKE_QUANTITY of the current accounting period * ITEM_MAKE_COST of the current accounting period) / (TOTAL_LAYER_QUANTITY of previous accounting period + BUY_QUANTITY of the current accounting period + MAKE_QUANTITY of the current accounting period).

Is that correct? The question is how LCM charges are considered in this formula?
 

Solution

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