Landed Cost- Essential Configuration

#D365FnO, #SCM, #LandedCost

Introduce

The Landed Cost module is a part of the D365 Supply Chain. This module helps an enterprise track the final cost of products after all logistics expenses.

This module empowers businesses to streamline inbound shipping, managing financial and logistical aspects from manufacturer to warehouse.

• Enabling users to estimate costs during voyage creation, allocate them across items/orders

• Supporting goods transfer between physical locations by recognizing landed costs.

• Providing precise estimates for overhead landed costs enhances visibility into the extended supply chain

• Reducing administrative workload, and minimizing costing errors.

Basic & essential configuration

From my end, I will describe some configurations I think are necessary for running the Landed Cost as simple.

Essential configuration for Landed Cost

Details of the configuration:

Cost Type Code

Cost Type codes - It's the main configuration for this Landed Cost module

Cost Type Code setup

• Reporting category: using to classify the cost type

• DEBIT: set posting Type = "Item" -> The cost value will be allocated for the Item and posted to the Inventory main account

• CREDIT: set posting Type = "Vendor" -> The offset account will be posted to Vendor's main account

• CLEARING account: select the clearing account for the cost type.

Note: The Standard Cost & Moving Average variance account - should be configured If your product was configured, the Model Type is Standard Cost and Moving Average corresponding. This variance account will be posted to Ledger if the Item cost differs between actual and estimated costs.

Vendor Cost Type Group

Vendor cost type groups help determine how auto cost charges are found and applied to a voyage.

To configure the Vendor cost type group, navigate through the following path:

Vendor cost type group

After creation, these groups can be associated with Vendors. (FastTab Miscellaneous details - field Cost Type Group)

Item Cost Type Group

Item cost type groups help determine how auto cost charges are found and applied to a voyage. For example, all items that have a duty rate of 5 percent might belong to a specific cost type group.

To configure the Vendor cost type group, navigate through the following path:

Item cost type group

After creation, these groups can be associated with the Release Product. (FastTab Purchase - field Cost type group)

Vendor setup

Voyage Status

Parameter

Simple Process for Landed Cost

Simple Process - Landed Cost

• Create the Voyage and input Purchase Orders which you want to track and control landed cost.

• Input and edit the estimated cost for the Voyage.

• Receive actual transportation billing then post an invoice for Purchase Order and increase Good In Transit (GIT).

• Receive GIT into your warehouse.

• Finally, update & check the landed cost and inventory value of the Item.

Above is my scribble for the basic configuration and simple process for the Landed Cost module in the D365 Finance & Operation.

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