Inventory Valuation with Multiple Costing Methods
While Inventory maintenance is very important, costing and valuation of the inventory is of utmost importance too. There are many steps and processes involved in inventory management which leads to the rise of costing like transport, warehouse charges, etc. These costs are also taken into consideration while the inventory valuation is done and the final costing goes out to the customer.
Over here, it helps the company to have an enterprise system in place which not only looks after the management of the inventory, but also the inventory valuation with multiple costing methods and generate a simplified report for the management.
The reports that are being generated should be accurate and which will further assist the decision making process of the management regarding any inventory related problems. Going one level down, choosing a proper costing method is equally important so that the decisions are made / revised accordingly considering the companies’ requirement and need.
Sage X3, a world class ERP solution, with its capability to handle multiple costing methods has helped organizations with required and accurate reporting. These reports definitely assist the end users to provide proper reports to the management and then in turn, it helps the management to take appropriate decisions regarding their inventory valuation.
Sage X3 supports multi costing for valuation, with the help of which the company can analyze the inventory valuation and moment with multiple costing options. For example, an organization may have a default costing method set as standard cost for all finished goods that they sell. At the same time the management will also require data of the same finished goods as if what would have been the impact if the costing method was been moving average.
Sage X3 has inbuilt reports in the system which help derive such information easily, where the costing method the item uses is different than the one for which the reporting is required. Based on this the management can review the valuation of the inventory at any point of time and can easily ensure whether the costing method they are following is as per their requirements or not or is there any revisions required.