You may use closing and adjustment in different cases.
I use this functionality to allocate labor and overhead costs to production.
If you want to allocate costs to Production orders in the end of the moth while the cost will change within the month.
You may not be able to use cost categories for costs and need to see the real values at the end of the month.
How I do is;
1) Change the posting profile for inventory to the relevant overhead and labour GL account.
2) Check the balance of the GL account from the trial balance.
3) Use adjustment functionality
Go with transactions
Select financial date interval and reference as "Production". You may set different additional values as well according to the allocation rules.
Then you may be able to allocate cost due to amount with different allocation principles.
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