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Supply chain | Supply Chain Management, Commerce

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General Knowledge Costing Version

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Posted on by Aneeq

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I am trying to understand the costing version functionality in D365 and perhaps it is my lack of understanding in the subject. I am trying to connect item model group and costing version calculation, so my question is:

1. Can I run a costing version calculation for an item that doesn't have an item model group Standard cost? For instance, an item model group FIFO/ LIFO, does the system treats them as standard cost when running the simulation?

2. Also, does item model group actually plays a role in this calculation or it is mainly for inventory closing?

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Dynamics 365 Supply Chain Management

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sagar_patil 920 Moderator on at

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1. Yes. For items without a standard cost (e.g., FIFO, LIFO), the costing version calculation does not treat them as standard cost but rather calculates costs based on the respective costing method, such as FIFO or LIFO.

For items with FIFO or LIFO item model groups, the costing version calculation can still be performed, but it will use the actual costs based on the FIFO or LIFO principles rather than a predefined standard cost.

2. The item model group has a direct role in costing calculations, especially for FIFO, LIFO, and other methods, as it defines how costs are handled throughout the item’s lifecycle in inventory. It is not just for inventory closing but plays a key role in inventory valuation and cost calculations.

Note: Please help verify answer(s) if they guide you in right direction so other community members can also benefit from your question with verified answer.

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