Active Costing is used to describe companies that want to see and manage cost data but do not want that data to post to the general ledger. In these companies: Actual, Market, and/or Standard costs are maintained by Item or LotNone of the items are configured to post costs to the general ledgerCost adjustments are maintained (manual process)Costs are not posted to the General LedgerThe balance in the Inventory Balance Sheet account(s) will only match the sum of the Inventory valuation report with a manual journal entryPassive Costing Items are Items where costs are maintained at the Lot level, but the 'Actual Costs' of those Lots are not included in the costing journal entries. They are identified as Items with an 'Item Type' of "Inventory" and a 'Costing Method' of "Passive". For these Items: - Actual and Market Costs can be maintained by 'Inventory Lot'.
- Layer Costs can be manually updated.
- Perpetual inventory balances will include the costs that have been maintained.
- When the transactions post to the General Ledger, these line items will not be evaluated to make any of the additional costing journal entries.
- The balances in the Inventory Balance Sheet GL account(s) will not match the sum of the Inventory value on the Inventory Valuation report unless manual journal entries are made.
|