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DP & zero priced inbounds are not considered as own inventory as per Ledger. No GL entries are made on receipt or end of month. So these cannot be added to own inventory.
When distributing DP and Basis inbounds, create receipts with "Ownership Type" as 'Storage' and cost zero.
On Settle storage, move ownership from Storage to Own just like regular purchase from storage.
[http://inet.irelyserver.com/display/INV/DP+contracts%2C+Basis+Contracts+and+Purchase+from+Storage]
[~ajith.dharan] ,
{color:#808080}_1. Now with the new changes, DP & Basis will use market rate for receipt. Will this work with the settle storage changes you guys made? Will settle storage make cost adjustment for the difference in IR price & Settle storage price? Or will it assume that the IR price is zero._{color}
The settle storage makes the cost adjustment by assuming the IR created by the scale ticket is zero cost.
{color:#0000ff} This is an issue.{color}
* {color:#0000ff}We are going to bring in DP & Basis contracts at market price and no longer at zero cost.{color}
* {color:#0000ff}Now if settle storage assumes the cost as zero, then the cost adjustment will be wrong. Settle will do cost adjustment for (received at 0 - settle at 5) $5 whereas actual difference is only (received at 4 - settled at 5) = $1{color}
{color:#0000ff}To fix this, these jiras has to be undone{color}
http://jira.irelyserver.com/browse/SC-445
http://jira.irelyserver.com/browse/IC-2906
{color:#808080}_2. Grain industry works on Avg cost. I am unable to understand the complexity of the formula. If the IR cost is zero, if we do not compute the avg cost, won't the avg cost remain as what it was earlier?_ {color}
It sounds like you wanted to skip it. The system can't skip the calculation of the average cost just because the received qty is using zero cost. Average cost formula is simple: (Total Stock Value) / (Total Stock Qty). The complex part is when you have to re-adjust the total stock value and adjust the average cost after stock has been sold.
{color:#0000ff} If the above jiras are undone, then avg cost will go wrong again. That means cogs will go wrong.{color}
{color:#0000ff}To fix this, Avg cost computation should skip receipts at zero cost for computing avg.{color}
{color:#0000ff}Avg Cost = (Total stock value) / (Total Stock Qty with value){color}
{color:#0000ff}Settle storage or Price Contact will make cost adjustments and recompute avg cost {color}
{color:#0000ff}If the stock is Sold and avg cost used to bookd cogs was > zero-{color}
* {color:#0000ff}Do not make a cogs adjustment entry{color}
* {color:#0000ff}Remaining inventory will be sold at new avg cost.{color}
{color:#0000ff}If stock was sold and avg cost used to book cogs was zero{color}
* {color:#0000ff}make cogs adjustment entry with new avg cost.{color}
_3. Grain industry does not use inventory valuation report to see the value of inventory as there is DP & Basis. They value inventory at market price and have a different report called Daily position report. So no need to worry about running avg cost in this report._
Can we have a sample of the Daily Position report? I think it is time set a new goal to ensure inventory valuation and Daily Position report matches.
{color:#0000ff} it is under Risk Management module. At this point, I am not worried about what DPR shows. What we have to take care of at inventory is that cogs is on avg cost and avg cost should exclude zero cost receipts.{color}
{color:#0000ff}Avgcost computation{color}
{color:#0000ff}Now & Required{color}
{color:#0000ff} !pastedImage_d74665_0.png! {color}
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