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Project Cost and COGS

in Project Management 2 comments

Summary:

Dear All,

I have a scenario that I'm trying to get my head around:

I'm buying material to a project/task. Perform manufacturing activities and ship off the assembly to a project sales order. My understanding of the financial transactions are:

Buying Inventory to Project (Debits Inventory Valuation) collected cost to projects $100

use inventory project ($50) and labor ($50) and common stock ($20) and complete/close the Work Order (Projects get another $70 Cost) and inventory valuation debited another $70 → $170 Inventory Valuation and $170 project cost

When I ship off the Sales Order Line for that assembly, Oracle will credit the inventory for ($50+$50+$20) = $120 and debit the project clearing account.

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