Setting up Inventory Organization in Oracle R12:
Any Organization which needs to be defined as an Inventory Organization
needs to be classified as an Inventory Organization.
Define the Ledger, Legal Entity, and Operating Unit
(Optional) for the Inventory organization in the
accounting Information.
Setup the Inventory Organization Parameter for defining the
Control for particular Org. Following Major inventory Organization Related
setups can be done in the Inventory Parameter screen.
·
We can define the Organization as an Master
Inventory org or we can attach one.
·
The Workday calendar can be defined.
·
Set up Locator Control option
·
Enable the Inventory organization for other
peripheral Products such as Ware house management, Landed Cost management,
Process Manufacturing etc.
Costing
Information
The Costing Information is a vital component of the
organization definition. The Costing Organization displayed in the Costing
Information tab of Organization Parameters is based on the control level that
you set for the item attributes Costing Enabled and Inventory Asset Value. If
the control level for these attributes is set to Master, then the item master
organization defaults as the costing organization. The current organization is
displayed if the control is set to Organization level.
Valuation Accounts :
The Material Account is required for all organizations. Material costs represent the cost of raw material component at the lowest level of the assembly. For asset items, the material account is used as the default requisition account when you create purchase requisitions for Inventory Items.
The Material Account is required for all organizations. Material costs represent the cost of raw material component at the lowest level of the assembly. For asset items, the material account is used as the default requisition account when you create purchase requisitions for Inventory Items.
The Outside Processing Account is used for tracking
Outside Processing (OSP) costs. OSP costs represent work performed by a
supplier on a discrete job or repetitive schedule.
The Material Overhead Account tracks material overhead or burden costs. These are the costs required to bring items into or out of inventory locations.
The Overhead Account tracks costs related to resource or department overhead.
The Resource Account captures resource costs which are direct service costs required to manufacture products.
The Expense Account is used to record the value of items issued to a non-tracked and/or expense Inventory transactions.
The Material Overhead Account tracks material overhead or burden costs. These are the costs required to bring items into or out of inventory locations.
The Overhead Account tracks costs related to resource or department overhead.
The Resource Account captures resource costs which are direct service costs required to manufacture products.
The Expense Account is used to record the value of items issued to a non-tracked and/or expense Inventory transactions.
Other Accounts:
This Tab is used for deriving Other accounts which will be
used while creation of accounting entries for the transactions such as Purchase
price variance, Invoice Price Variance, Inventory Accruals Account etc.
Receiving options:
Setting Up Receiving options is another important setup step
while setting up Inventory Organization, Although the receiving options can
also be setup while Purchasing Setups.
