Oracle®Process Manufacturing CostManagement Release11.0 PartNo.A69857-01 Oracle® Process Manufacturing Cost Management Part No. A69857-01 Copyright © 1999, Oracle Corporation. All rights reserved. Primary Authors: Sudha Seshadri The Programs (which include both the software and documentation) contain proprietary information of Oracle Corporation; they are provided under a license agreement containing restrictions on use and disclosure and are also protected by copyright, patent and other intellectual property law. Reverse engineering of the Programs is prohibited. The information contained in this document is subject to change without notice. If you find any problems in the documentation, please report them to us in writing. Oracle Corporation does not warrant that this document is error free. No part of this document may be reproduced or transmitted in any form or by any means, electronic or mechanical, for any purpose, without the express written permission of Oracle Corporation. 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Contents Send Us Your Comments 1 Reader's Comment Form...............................................................................................1 Cost Management Preface 3 Cost Management Welcome.........................................................................................3 About OPM Cost Management.....................................................................................3 Audience for OPM Cost Management .........................................................................4 Conventions ..................................................................................................................5 Do Not Use Database Tools to Modify Oracle Applications Data ..............................7 Information Sources Related to OPM Cost Management ............................................7 Online Documentation.....................................................................................7 Other Information Sources ..............................................................................8 Other Sources..............................................................................................................10 Training .........................................................................................................10 About Oracle...............................................................................................................10 Thank You ..................................................................................................................11 Overview 13 Cost Management Overview ......................................................................................13 OPM Cost Development Area .......................................................................13 Defining Costs ...............................................................................................14 Standard Costing and Actual Costing............................................................15 Activity-Based Costing..................................................................................17 General Ledger Expense Allocations ............................................................18 Assigning Value to Inventory Transactions ..................................................19 Manufacturing Costs Over Time ...................................................................20 Inventory Cost Revaluation ...........................................................................21 Inventory Valuation in Production ................................................................22 Calculating Purchase Price Variance on Purchase Orders ............................23 Freezing Costs for the General Ledger..........................................................24 Inventory Valuation for Sales Orders............................................................25 Oracle Process Manufacturing Cost Management Contents • i Costing Setup 27 Setting Up Cost Management .................................................................................... 27 Defining Cost Methods .............................................................................................. 28 Standard Costing ........................................................................................... 28 Actual Costing............................................................................................... 29 Find Cost Method....................................................................................................... 33 Defining Cost Calendars ............................................................................................ 34 Find Calendar ............................................................................................................. 36 Flexibility in Restricting Cost Updates......................................................... 37 Cost Calendar - Additional Menu Features................................................... 37 Defining Cost Component Classes............................................................................. 38 Cost Component Class Manipulation Examples........................................... 38 Find Cost Component Classes.................................................................................... 41 Indirect Component Processing for Standard Costing.................................. 42 Defining Cost Analysis Codes ................................................................................... 43 Find Cost Analysis Code............................................................................................ 44 Defining Component Groups ..................................................................................... 45 Find Cost Component Groups.................................................................................... 46 Defining Costing Warehouse Associations................................................................ 47 Find Cost Warehouse Codes ...................................................................................... 49 General Ledger Fiscal ................................................................................................ 50 Standard Costing Setup 51 Standard Costing Setup Overview ............................................................................. 51 Defining Standard Item Costs .................................................................................... 52 Cost Detail Form - Format ............................................................................ 52 Defining Standard Costs for New Items or Ingredients ................................ 53 Cost Detail Form Prerequisites ..................................................................... 53 Find Cost Details........................................................................................... 57 Cost Details Form Menu Features................................................................. 58 Defining Resource Costs............................................................................................ 59 Find Resource Cost ....................................................................................... 61 Resource Cost Selection................................................................................ 62 Resource Cost List ........................................................................................ 63 Defining Cost Burdens............................................................................................... 64 Find Burden Details ...................................................................................... 68 Defining Rollup Source Warehouses......................................................................... 69 Find Rollup Source Warehouse .................................................................... 71 Defining Rollup Target Warehouses.......................................................................... 72 Find Rollup Target Warehouse ..................................................................... 73 Standard Cost Calculations 75 Standard Cost Calculations Overview ....................................................................... 75 Standard Cost Rollup - Prerequisites