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COGS and DCOGS Workflow Example of a Revenue / COGS matching for a Sales Order (Doc ID 867912.1) To Bottom
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Status: WHITE PAPER
Last Major PUBLISHED
APPLIES TO: Update: Jul 9, 2015
Last Apr 6, 2018
Oracle Cost Management - Version 12.0.0 and later Update:
Information in this document applies to any platform.
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ABSTRACT
Oracle Cost Management
The following scenario illustrate a short example of a Revenue / COGS matching for a sales order where Accounting rule used is:
3 Months, Deferred Information Centers
Information Center: Oracle
Cost Management [1417659.2]
HISTORY
Information Center: Oracle
Manufacturing Period Close
Author : Marius Garip [1399895.2]
Create Date 04-Aug-2009
Update Date 04-Aug-2009
Document References
DETAILS COGS Dataflow and
Diagnostics [Video]
The following scenario illustrate a short example of a Revenue / COGS matching for a sales order where Accounting rule used is: [1307906.1]
3 Months, Deferred Deferred COGS (DCOGS)
Accounting [416678.1]
Please review attached file COGS1-Example
Understanding COGS and
DCOGS Recognition
1.Define new Item Accounting [1060202.1]
Navigate to : Inventory>Item Master>Define item MM-ITEM65 (Purchase Item)
Create Accounting
Assign to Organization M3
Unprocessed Events On The
Subledger Period Close
2. Do a Miscellaneous Receipt in Organization M3. Exception Report for WIP and
Navigate to : Navigation: Miscellaneous Transactions>Receive MM-ITEM65 in Subinventory Store. INV Transaction with NO
Qty 100@15USD distributions [738529.1]
16. Now the revenue has been recognized according to our accounting rule: 3 Months, Deferred
GL Date Amount
50% August 37.5
25%September 18.8
25%October 18.7
17. Now we run a set of concurrent processes to record sales order and revenue recognition transactions and to create and cost
COGS recognition transactions. These COGS recognition transactions adjust deferred and earned COGS in an amount that
synchronizes the % of earned COGS to earned revenue on sales order shipment lines.
18. Record Order Management Transactions: records new sales order transaction activity such as shipments and RMA returns in
Oracle Order Management.
19. Collect Revenue Recognition Information: determines the percentage of recognized or earned revenue related to invoiced
sales order shipment lines in Oracle Receivables.
20. Generate COGS Recognition Events: creates and costs COGS recognition events for new sales order shipments/returns and
changes in revenue recognition and credits for invoiced sales order shipment lines.
21. A non-physical transaction has been generated Transaction Type= COGS Recognition
The distribution for the COGS Recognition transaction associated with the Sales Order transaction now would be as follows:
Thus, essentially the recognized COGS balance is to move the value from Deferred COGS to COGS.
This particular COGS recognition transaction actually corresponds to a revenue recognition percentage change.
Note:
Make sure you are on the latest file version CSTRCMVB.pls 120.45.12010000.92 Patch 20770685:R12.BOM.C or
higher
SUMMARY
REFERENCES
Attachments
COGS1-Example (2.74 MB)
Related
Products
Oracle E-Business Suite > Manufacturing > Discrete Manufacturing > Oracle Cost Management > Revenue-COGS Matching > Revenue-COGS Matching
Keywords
ACCOUNTING; CM_PIC_COGS; COGS; COGS RECOGNITION; COST MANAGEMENT; DCOGS; GENERATE; ITEM; ORDERED ITEM; RECEIVABLE; REVENUE; REVENUE RECOGNITION
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