We use the Update Standard Cost Report in the production information management module as a guide to updating standard cost on a quarterly basis. We've com across an item that had a standard cost of $.49 in 2021. We've made one purchase in 2022 at $1.87. The update standard cost report displays these 2 values and suggests a new standard cost of $2.20. I do not see anything configured under cost management parameters or policies. Can some explain how D365 arrived at this value? I don't think quanities on hand would factor in since, previous standard cost and the purchase unit price are both below the suggestion.
its big concept. you need to check item model groups, quantity, purchase price, sales price, purchase order is invoiced or not?
System automatically take standard cost.
go to product - released products - (Select item) check on hand inventory, transactions and transaction details.
Price calculation for opportunity, quote, order, and invoice records (Dynamics 365 Sales) | Microsoft Docs
I can't find anything in the documentation about how the suggested standard cost is determined. Upon further review it appears that whenever the last purchased price is above the current standard cost, the suggested standard cost is above both the current standard cost and the last purchased price. I have no clue how it is determining this.
When the last purchase price is below the current standard cost, the suggested price is either the current standard cost or very slightly less than the current standard cost. I could see the on-hand and purchased quantities factoring into this but it does not appear that any kind of weighted average is being calculated.
This seems like a bone an auditor could chew on for quite a while. It is very odd that there is no documentation explaining it, but perhaps I'm just missing it.
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