Dimensions Only - This feature is not available in Dimensions Lite

Stock Records > Sub Analysis > Landed Cost tab

On the Stock records, items that have been flagged as Sub Analysis, can have Landed Costs recorded against any of the Sub Analysis.

Clicking on the Sub Analysis function function displays the Sub Analysis window.

Two of the tab cards on this window, Quantity and Landed Costs, are used for Landed Cost setup and recording.

On this tab card you can view both Total (Actual) and Committed Landed Costs.

Total

The Total value will always increase, it will never be decreased by Sales, Movements or Transfers out. The total can be reconciled with the help of the Landed Cost enquiry window which can be opened from the Quantity tab card (see below).

Committed

The Committed Costs will increase and decrease with the 'ordered in' quantity.

On the Quantity tab card, these Committed Costs can be reconciled to the Total Committed Landed Costs value.

On this tab card, the calculations will be made based on 'Ordered in' quantities (Committed Landed Costs) and Actual 'Movement in' quantities (Actual Landed Costs).

Committed Landed Costs and Actual Landed Costs are shown separately.

The information shown on the right hand side is as follows:

Average Value - This is the total value and each value of the Stock in each Sub Analysis for this Stock item, dependent on the valuation method chosen.

If Latest, FIFO or Average method of valuation is being used:

The pull down menu Values including Landed Cost is enabled, and you can choose whether to include or exclude Landed Costs.

If Weighted method of valuation is being used:

The Weighted Value is displayed in place of the Average Value. This will automatically include any Actual Landed Costs

The pull down menu Values including Landed Cost is disabled. (It is not possible to separate the Landed Costs from the Weighted value)

Standard Value is calculated as usual, regardless of all other settings chosen.

Actual Landed Costs will be the net Landed Costs as shown in the Landed Costs transaction enquiry.

When the currently selected Sub Analysis has some Landed Costs, Physical becomes a menu with the options Physical and Landed Costs. This menu will only be available if the Sub Analysis has Landed Costs

When Landed Costs is selected,the drill button displays the Landed Cost Transactions Enquiry window.

The enquiry is based on the Stock Movements:

This transaction enquiry is effectively a filtered version of the main Stock Record Transaction Enquiry. It shows the Landed Cost transactions written to the Stock Movements table (these are flagged with an L) as well as all other transactions for the Stock and Sub Analysis record.

Whenever a Purchase Order, Sales Order, Stock Movement, Sub Analysis Transfer or Stock Take is done, for a Sub Analysis Stock record that has Landed Costs against the Sub Analysis Code, an extra value is posted - the total Landed Costs.

In addition, 'Transactional' Landed Costs are shown in the Stock Movements table - flagged as type L. These are transactions that originate from the Purchase Ledger or as Adjust Landed Cost Values Stock Movements.

The total net Landed Cost for the transaction (Actual Landed Cost) is displayed at the bottom of the Landed Cost column.

When looking at this enquiry, only those transactions with Landed Costs are shown. The Landed tab card, active when a Detail line is selected in the enquiry window, contains the details of the Landed Cost calculation.

As with all Enquiry windows, the View: All Years All Periods menu enables you to change the Periods and Years to be displayed.

Clicking on the List Definition function enables you to change the filters used to display the transactions. This enables you to select to view batched transactions if required.

Dimensions Only - This feature is not available in Dimensions Lite

Landed Costs are only involved when you use a Stock item that has been flagged as having Sub Analysis. These Sub Analysis must also have Landed Cost details set up for them.

The Landed costs can be any of 4 different types: Value, Fixed, Percentage or based on Transactions.

All Types except Transactional Landed Costs are calculated through POP, SOP and Stock Transactions.

The Landed Cost Adjustment OUT does not affect the Nominal Ledger. This means that the Weighted value of the stock will not match what has been posted to the Nominal Ledger. Where the Landed Cost Adjustment is making a correction to an overstatement of the Landed Costs, you will have to manually enter an adjustment to the Nominal Ledger.

Transactional Landed Costs are calculated on Stock Movements which have the Transaction Option Update Landed Costs set for them and Purchase Ledger Transactions which use Analysis Codes that have Update Landed Costs selected.

These Transactions are either:

Movements in (Purchase Orders, Stock Movements (in), Stock Takes (increases), Sub Analysis Transfers (in), and SOP Credit Notes). These are always calculated precisely, on a line by line basis. That is, each Landed Cost line is calculated independently.

Movements out (Sales Orders, Stock Takes (decreases), Sub Analysis Transfers and Stock Movements out using the Selling Price) these are calculated using an average Landed Cost.

Weighted Average Cost x Quantity moved out.

(Cost Price as defined by the stock valuation method + Average Landed Cost) x Quantity moved out.

Movements Out generated by Stock Movements out using the Cost Price, are calculated as Cost Price (as entered on the Stock Movement transaction) x Quantity moved out.

N.B. These Committed and Actual Landed Costs are NOT the same as the Committed and Actual Values involved in Purchase Control.

As values held against the Sub Analysis for outstanding Purchase Orders are reduced (goods are delivered), Committed Costs fall and Totals (Actual Costs) increase.

The calculation used for a Batched Transaction depends on the Transaction Options selected:

If the option Update Stock on Order is not selected, the Landed Costs are not calculated, until the delivery occurs.

If the option Update Stock on Order is selected, the values held against the Sub Analysis for outstanding Purchase Orders is updated, and this value is used as the Committed Landed Costs.

When a Purchase Order is delivered (and updated), the Physical Stock held against a Sub Analysis is updated, this change in Physical is used to calculate Actual Landed Costs which are posted to the Actual Costs field on the Quantity tab card.

If you Edit the Transaction and change the Quantity, this will change the Values held against the Sub Analysis for outstanding Purchase Orders, and therefore the Committed Landed Costs.

If you process the Transaction through the Detail window:

Both Committed Costs and Actual Costs are posted to the Landed Cost tab card, and can be seen in Total on the Quantity tab card, and in detail on its Landed Cost enquiry.

These affect Actual Landed Cost on the Quantity tab card, but do not affect the Total Costs which just summarises all incoming Landed Cost values.

Examples:

A batched Purchase Order for 10 items (with details as described above) has a Cost of £150 and Committed Landed Costs of £64.

If 12 items are delivered, then the Committed Landed Costs should return to £0, and the Actual Landed Costs become £68.8.

[£40 + (12 x £1.65) + (12 x £15 x 5%)] which is (£40 + £19.8 + £9)

If instead 5 items are delivered, then the Committed Landed Costs becomes £12

[(5 x £1.65) + (5 x £15 x 5%)] which is (£8.25 + £3.75)

and the Actual Landed Costs become £52

[£40 + (5 x £1.65) + (5 x £15 x 5%)] which is (£40 + £8.25 + £3.75)

N.B. from a batched Transaction, once delivery is started, the whole 'Fixed' Landed Cost is posted as Actual.

When posting a Sales Order for a Stock item, the system reduces:

Any transaction that affects the Landed Cost will also be shown on the Landed Cost enquiry on the Quantity tab card on the Sub Analysis window.

When entering a Sales Order there is no change to Committed Landed Costs.

When the Delivery Note is updated, the Committed Landed Costs will be reduced.

The Committed Landed Cost reduction value will be based on the Profit Cost method selected in Stock Options - Records.

If the Profit Cost method is Average, Latest or Landed then the Stock valuation is reduced by:

(Cost Price + Average Landed Cost) x qty. moved out.

If the Profit Cost method is Weighted Average, then the Stock valuation is reduced by:

(Weighted Average Cost x qty. moved out).

When processing a Credit Note there is a Transaction option Do not update Stock.

If this option is selected, then there is no Stock Movement and no Landed Cost effect.

If this option is not selected, then Stock is updated by a Movement in on a line by line basis (i.e. similar to a Purchase Order)

The Transaction option Update Landed Costs can be selected if you wish to create a Stock Movement but not a Landed Cost effect.

When Stock is moved IN because a SOP Credit Note has been issued, it should not be necessary to add the Landed Costs to the value of the Stock as they have already been accounted for in the sale price of the goods i.e. the value of the credit note.

If the option is NOT selected, when a SOP Credit Note is processed, the Landed Costs will not be updated.

If selected, when a SOP Credit Note is processed, the Landed Costs will be updated.

You should be aware that the quantity of stock moved IN, because a SOP Credit Note has been issued, will be used when calculating Actual Landed Costs for subsequent movements out, even if the option to Update Landed Costs was NOT selected for the Credit Note.

This is because the unit Landed Cost is always calculated as the Total Landed cost divided by the Physical quantity. If a reduced quantity was used, it would be possible for the Total Landed costs to become negative if all the stock was moved out.

When the Transaction Option Batch Order has been selected, then:

If the Transaction option Update Stock on Order:

If a batched Order is Edited, this may change the value of the outstanding Orders for this Sub Analysis of this Stock record, and therefore the Committed Landed Costs.

When that order is delivered, these rules are superseded by the delivery rules.

Committed Landed Costs are updated to 2 places on the Sub Analysis tab cards:

Firstly to Committed Landed Costs on the Quantity tab card,

Secondly these Committed Landed Costs are included in the Committed and Total columns on the Landed Costs tab card.

If the Sub Analysis Code on the Detail line has been left blank, no Landed Costs can be calculated until this Code is entered. The point in the process when the Code is entered, will determine which rule is then applied.

Landed Cost calculation

If the Order is entered and delivered at the same time, the Physical quantity is used to calculate the Landed Costs.

If the Order has been Batched and is now being delivered:

Regardless of whether the Order is delivered straight from the Batch, or through the Detail window (part deliveries/adding the Sub Analysis), the Physical quantity is updated, and this is the value that is used in the Landed Cost calculation.

If Committed Landed Costs have already been calculated, they are now reduced as the Ordered In value decreases, they are not relevant to the actual Stock valuation.

If the delivery is updated, the Actual Landed Costs are saved.

If the delivery is not updated, that particular calculation of Actual Landed Costs is cleared.

This is specifically for the Deliveries to Update field, as although the Delivery Note has been printed, the Order Quantity has not been accepted as the Delivered Quantity.

Finally, if the Transaction Option Update Cost Price has been ticked, and a Sub Analysis Stock item is involved, and the Transaction line's Cost Price is different from that on the Sub Analysis window Analysis tab card, the Unit Cost Price on the Analysis tab card is updated and used in the calculation of the Landed Costs.