In my first post on this subject, I wrote about how D365FO uses the average cost price on outbound inventory transactions. This could be sub-contracting work or very expensive materials. This is often used in scenarios where you need to track the specific cost of an activity.
It goes without saying that tracking cost by batch or serial number allows for very specific and granular costing. Similarly, if the overhead costs in one warehouse differs from another, you can decide if you would like to track cost by warehouse. By calculating cost by site using the inventory dimensions, you are able to correctly track cost depending on where and how you manufacture the product. You can use this to calculate cost on the appropriate level for a given scenario.įor instance, if you manufacture a product on two different sites, the cost is likely to be different for each site. This indicates that we, in this case, are tracking cost on batch level. What is important in terms costing is the tick in the Financial inventory column. The above picture shows an example of a Tracking dimension group. The first thing to understand in D365FO when it comes to managing costs, is how to use inventory dimensions and how they affect costing. It consolidates most of the functions, queries and reports you need to manage costs in D365FO, and in addition, it brings along two new workspaces for cost administration and cost analysis. This module was not available in Dynamics AX 2012. The Cost Management Moduleīefore we get started, I just wanted to highlight the Cost management module in D365FO: Therefore, I will initially explore a couple of basic cost management areas in the system and then follow-up with an Costing and adjustment example to highlight how to use the system. How you actually manage costs, depends on your scenario. In this post we will look more into how you actually manage costs and how this affects various parts of the system.
In the previous posts, we looked at the core concepts underpinning the inventory cost model in D365FO and how some of the key areas should be configured. The series is expected to include the following parts: This is the third instalment in my series of articles explaining the inventory cost model in Dynamics 365 for Finance and Operations (D365FO).
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