Table of Contents

A10) Cost Finalization

The purpose of this step is to align the provisional service valuation (used at shipment) with the final, fully burdened production cost of the repair output item (*-REP).

What Happens at Service Shipment

  • The Service Shipment creates a Service Ledger Entry (SLE).
  • That SLE initially uses the Repair Item's Direct Unit Cost at the time of posting (often still based on expected or partial cost roll‑up).
  • Variances (later material postings, labor adjustments, overhead application, revaluation) are not yet reflected.

Role of Adjust Cost - Item Entries

Running the Adjust Cost - Item Entries batch job:

  1. Recalculates actual item cost (consumption and output).
  2. Updates Item Ledger Entries and creates Value Entries.
  3. Propagates revaluation back to the linked Service Ledger Entry (where applicable), so service profitability reports reflect real cost.

When to Run

Choose timing based on reporting needs:

  • Immediate (same day) if you need near-real margin visibility.
  • Batch (nightly) for performance / volume efficiency.
  • Period-end (minimum) to ensure financial statements show corrected service cost.

Typical Sequence

  1. Finish Production Order (all expected postings complete).
  2. (Optional) Post Service Shipment immediately for turnaround speed.
  3. Run the Adjust Cost - Item Entries batch job (single or batch).
  4. Review:
    • Item → Value Entries (final cost in place)
    • Service Ledger Entry → Cost Amount (Actual) updated
    • Margin / analysis reports now stable
Tip

Treat cost adjustment as a required close step for reliable repair margin analytics. For more information, see Repair Order Cost Handling.

Summary

The Adjust Cost - Item Entries batch job transforms provisional shipment valuation into authoritative actual cost—closing the loop between production, service, and the G/L while preserving audit traceability.

  • Provisional → Actual cost reconciliation
  • Accurate service profitability
  • Consistent inventory and ledger valuation

Previous Step

A9) Service BOM Update on Service Shipment


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