My Oracle Support Banner

Costing Hook Usage For Dropship Material Overhead Handling (Doc ID 2352377.1)

Last updated on AUGUST 15, 2023

Applies to:

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


On FIFO org, Material Overhead(MOH) absorption rule is defined for PO receipt, However to avoid material overhead from being earned for Dropship PO receipt (not involving intercompany flow), custom code is defined on CSTPACHK.actual_cost_hook to set material overhead cost = 0 on mtl_cst_actual_cost_details.

- cost_element_id = 1 (Material)
- level_type = 1
- actual_cost = PO Unit Price
- prior_cost = 0

- cost_element_id = 2 (Material Overhead)
- level_type = 1
- actual_cost = 0
- prior_cost = 0

Dropship PO receipt is executed for 2 units with PO price=4466.66 then Cost Manager created MTA records as below;

Accounting_line_type /Base Transaction Value /Rate or Amount Cost /element id

Accounting_Line_type Base_Transaction_Value Rate_or_amount Cost_Element_id
1: Inv Valuation 8933.32 4466.66 1
3:Overhead absorption 0 133.9998 2
31:Clearing -8933.32 4466.66 1
1: Inv Valuation -268 -134 2
13:Cost Variance 268 133.9998  


Then 0 amount is set for Overhead Absorption record on debit side (second line), but material overhead is earned on credit side (forth line). It cause cost variance in debit side (fifth line).

Material overhead Amount is updated with the amount specified on hook.

The issue can be reproduced at will with the following steps:

  1. Add customer code on CSTPACHK.actual_cost_hook to insert data as below mtl_cst_actual_cost_details
    cost_element_id = 1, actual_cost = 4466.66
    cost_element_id = 2, actual_cost = 0
  2. Compile CSTPACHK.
  3. Receive Dropship PO.
  4. See distribution Records on mtl_transaction_accounts.


To view full details, sign in with your My Oracle Support account.

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

In this Document

My Oracle Support provides customers with access to over a million knowledge articles and a vibrant support community of peers and Oracle experts.