Query
I have a purchase order and item receipt with a single item.
The landed cost set up on the item receipt:
Why is the $100 not allocated to the item in full since there is only one item being receipted?
How is the $65.53 calculated?
The item’s weight is 400g/each. It is sold, stocked and purchased in each.
Solution
If the item uses standard costing, the system records any difference from the standard cost and actual cost under the Purchase Price Variance account on transactions.
Hence, for Assembly Items with standard costing method, landed cost is not capitalized in the standard cost of the item, but is rather charged to Variance Account.
noticed that there is an Exchange Rate of 0.65526505 on the Item Receipt. I noticed as well that the Landed Costs are sourced manually. If it is sourced manually, the exchange rate of the Item Receipt is followed at the time of the transaction. The Landed Cost on the Item receipt is auto-calculated based on the exchange rate as of the day the Purchase Order is received.
Hence, $65.53 is calculated as $100.00 x $0.65526505.
You may check SuiteAnswer article: 105520 | Landed Cost’s Currency When Applied to an Item Receipt/Standalone Bill FAQs as a point of reference.