Labor and Machine cost elements at Source Org getting transferred to Destination Org

Summary:

We have Finished Goods items that are produced at the Source Organization and then transferred to Destination organization through Transfer Order. Since at the Source Org, these Items are completed through a Work Order they have Labor and Machine resources which are costed. However, when transferring this Item to Destination org, same Labor and Machine Cost elements are showing for Destination Org when generating costing distributions.

From Destination Org perspective, this is a purchased Item from another Org so they should not have Labor and Machine Cost elements and everything should have been mapped to Material Cost element.

Both Source and Dest orgs are on perpetual average and we have Supply Chain Financial Orchestration flow setup for Internal transfer. Transfer price is determined based on pricing strategy from FOM.