Lot FIFO Costed Part with no Stock On Hand - what costing method is used?

Kinetic ERP
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Hi,

All of our parts are lot-tracked and use the Lot FIFO costing method.
This uses the costs from the oldest lot that is in stock for the part.

My question is: What costing method does Epicor fall back on when no stock is on hand?

For reference, we have a manufactured part that is no longer in stock. The Part Tracker > Cost Details tab shows ‘Last’ and ‘Average’ costs for the part, based on previous manufacturing history. It also shows ‘Standard’ costs, which were set by Costing Workbench.

Any guidance would be much appreciated!

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I heartily recommend for your reading pleasure the Job Costing Technical Reference Guide (on EpicWeb). Beginning on page 151 is the most compete description of the Lot FIFO costing option I’ve found.

Essentially, each lot starts with no FIFO layers, and as each layer is created, a quantity and cost are assigned to them. When a layer is completely consumed., the quantity will revert to zero. Upon the next receipt of that Lot number, a new layer will be created, beginning with both cost and quantity being zero (see page 153, “Logic/Algorithms”).

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Thanks for the information @Ernie. The guide made sense to me, except on the following query:

For a Lot FIFO-costed part - when all layers have been consumed, what would drive the cost for this part? E.g. when Quoting?

I can see, on Part Activity > Cost Details, that the system still holds Average, Last and Standard costs for the part.

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That’s an AWESOME question to which I only have an extremely lame answer… I have no idea.

The only thing I can recommend is testing it out to see… and then if the value doesn’t make any sense (or even if it does) open a support ticket to find out the logic behind it.

Anyone else have a go at this?

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For some additional information, Epicor ALWAYS generates/updates the Average and Last cost values for each part (described under those cost methods in the guide). I’m going to GUESS that one of these values will be pulled for Quoting, but it’s only a guess.

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I don’t believe it will @ernie. When quoting, the cost defaults to whatever the part has for a cost. I tried seeing if I could set a standard cost and use that only for quoting (since we are average) and you cannot change the cost method on a quote. My guess is that a Lot FIFO part will either come in at $0 or the Standard Cost. I would be interested to know what happens @ZanebK , have you tested it yet?

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Just tested this on a quote, using a Lot FIFO Part which:

  1. Has no current on-hand stock.
  2. Has values for Standard, Average and Last costs.

The Standard cost was pulled through onto the BOM.

Possibly it’s the ‘default’ behaviour, but I can’t find any documentation backing this up. Would be curious to know if it’s possible to defer to Average or Last costing.

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My “guess” is that you cannot. It makes sense that the system takes standard for something that is FIFO. I would even “guess” that if you quoted something that was in stock that it still pulls the Standard.

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They just announced at Insights that they will fix this problem in 2025.1. If stock goes to zero they will keep the last average cost.

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That sounds great, looking forward to testing this in Pilot.

For now, I’ll use Costing Workbench to update our Lot FIFO parts with Standard costs for quoting.

Thanks all :pray:

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Note - if you buy direct to the job so the transaction does not go through inventory, the average cost is not updated.

It is possible to write a BPM to select were the cost comes from.
I have one customer that wanted Part.UnitCost to be put in as the cost so when reviewing the worksheet you would see the sell price of an assembly.

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