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Landed Cost Variance

  • 17 October 2022
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Hello,

I have a small issue with landed cost as some of the landed cost goes into the Landed Cost Variance Account and it does not show in the Inventory Valuation report and the Average Cost in the Stock Items.

Does anyone know the workflow to correct this issue?

The final bill of the landed cost cost is entered after we received our goods and we start selling them right away.

Landed Cost Variance Account

The expense account to be used for this stock item to record the landed cost difference that occurred if landed costs are allocated to an item that has been sold.

 

Thanks,

Nelson

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Best answer by Laura02 18 October 2022, 14:33

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Laura02
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Hello,

I think you have described a correct Landed Cost entry where some items were sold before the LC entry was booked; there is nothing to correct.  Late expenses for items that we don’t have in inventory do not update the cost of other items that are still in inventory, expenses received after the sale update Landed Cost Variance.

If some or all of the merchandise has already been sold, the portion of Landed Cost that is related to the items no longer in inventory should not update the average cost of items on hand and should not show on the Inventory Valuation report.

Landed Cost Variance can be reported with COGS on the Profit & Loss statements, as Landed Cost Variance is used to record a Cost for Goods that are already Sold.

Posting the entire amount of the Landed Cost to the inventory still on hand will overstate the value of your inventory and understand COGS.

Laura ~ Klear Systems, Inc. Irvine, CA. ~ Please remember to "Mark Best Answer" to help those who are facing the same problem.~
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Thank you for the clarification.

But how to get Acumatica to show the true cost of the item with landed cost.

Kandy Beatty
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HI @Nelson Yip 

 

Here is an older thread that may help you:

https://community.acumatica.com/distribution-6/question-about-landed-cost-adjustment-11145

Kandy ~ If a member helped you, please *Like* their post, and if a member provided an answer to your question, please mark it as *Best Answer*.
Laura02
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Hello,

Thank you for the clarification.

But how to get Acumatica to show the true cost of the item with landed cost.

When Landed Cost batches are released, you will see Inventory Cost Adjustment transactions added to the items that are on hand. The Valuation Total, total cost for all items still on hand is updated. To know the Average Cost “true cost” for each item on hand, divide by Quantity.

The Average Cost is also updated on the Price/Cost tab of Stock Items, Cost Statistics section  for the above item.

When the items are sold, Acumatica correctly deducts original merchandise price plus landed cost adjustments from inventory.

Laura ~ Klear Systems, Inc. Irvine, CA. ~ Please remember to "Mark Best Answer" to help those who are facing the same problem.~
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The problem is we received the goods on 8/3/22 and it got transferred to another warehouse on the same day.  But the Landed Cost was posted to the receiving warehouse on 8/11/22.

The goods started selling on 8/15/22, I guess the transfer from one warehouse to another and the landed cost posting to the receiving warehouse which caused the landed cost to post into the variance account.

Then it did not calculate into the average cost in the stock item price/cost tab.

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I am trying to understand this.  If I receive inventory in the Receiving warehouse and then move it to the STORAGE warehouse, any landed costs that I receive will go straight to Landed Cost Variance?

Michael Coman

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