Oracle Cost Management

Manufacturing Functional Foundation

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Objectives

After completing this lesson, you should be able to do the following: Understand the costing methods supported in Cost Management Identify the major tables used in Cost Management Discuss the open interfaces and application program interfaces for Cost Management

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Agenda

Cost Management Overview Cost Management Transactions and Entity Relationship Diagrams Cost Management Open Interfaces and Application Program Interfaces

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Oracle Cost Management Overview

Item costs

Analysis

Audit trail

Inventory

Production

Profitability

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Cost Structure

A cost structure is the collection of definitions and methods used to cost inventory, bills of material, and work in process. The cost structure is composed of: Organizations Cost organizations and shared costs Cost elements Subelements Activities Basis types General ledger accounts

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Cost Rollup and Updates

Cost Rollup

Engineering Information

Cost Update

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Costing Methods

Standard

Average

FIFO/LIFO

Periodic

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Standard Costing

Standard Cost

Actual Cost

Variance

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Average Costing
Receipts for Item XYZ

Receipt Date
January 13, 2005 February 02, 2005 February 27, 2005 March 16, 2005

Amount
$10.00 $14.00 $12.00 $11.00

Quantity
4 6 5 5

April 08, 2005

$14.00

Average Unit Cost for XYZ on February 28, 2005 = $2.40 Average Unit Cost for XYZ on April 09, 2005 = $2.35

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FIFO/LIFO Costing

FIFO (First In/First Out)

LIFO (Last in/First Out)

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Periodic Costing

Periodic Costing is an option that enables you to value inventory on a periodic basis. There are three principal objectives of periodic costing: To capture actual acquisition costs based on supplier invoiced amounts plus other direct procurement charges required by national legislation or company policy To capture actual transaction costs using fully absorbed resource and overhead rates To average inventory costs over a prescribed period, rather than on a transactional basis

Copyright 2005, Oracle. All rights reserved.

Agenda

Cost Management Overview Cost Management Transactions and Entity Relationship Diagrams Cost Management Open Interfaces and Application Program Interfaces

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Defining Item Costs

To define or maintain item cost information use the Item Cost window.

Item Costs (M1)

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Standard Cost Type

MTL_SYSTEM_ITEMS_B

CST_COST_TYPES

CST_COST_ ELEMENTS

CST_ITEM_COSTS

CST_ACTIVITIES

BOM_ RESOURCES

CST_ITEM_COST_DETAILS

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Average, FIFO, LIFO Cost Types

MTL_SYSTEM_ITEMS_B CST_COST_ ELEMENTS

CST_COST_TYPES

CST_ITEM_COSTS

CST_ACTIVITIES

BOM_ RESOURCES

CST_QUANTITY_LAYERS
CST_LAYER_ COST_DETAILS
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Resource and Overhead Costs

CST_COST_TYPES

CST_ RESOURCE_ COSTS

BOM_RESOURCES
MATERIAL MATERIAL OVERHEAD OVERHEAD RESOURCE/ OUTSIDE PROCESSING CST_ RESOURCE_ OVERHEADS BOM_ DEPARTMENTS

CST_DEPARTMENT_OVERHEADS

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Agenda

Cost Management Overview Cost Management Transactions and Entity Relationship Diagrams Cost Management Open Interfaces and Application Program Interfaces

Copyright 2005, Oracle. All rights reserved.

Cost Management Open Interfaces and Application Program Interfaces

Periodic Cost Open Interface

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Summary

In this lesson, you should have learned how to: Describe the costing methods supported in Cost Management Identify the major tables used in Cost Management Discuss the open interfaces and application program interfaces for Cost Management

Copyright 2005, Oracle. All rights reserved.