# How to re-set standard costs for inventory

KB268

### Overview

This process outlines how to use stocktakes to change the standard cost of components and assemblies.

### Process

Step 1: Check that there are no inventory alerts with residual values

- Run SA1203 and make sure it is clear

Step 2: Remove all inventory from stock

Standard costs can only be changed for items that have nothing in stock

- Create a stocktake: Inventory > Stocktake.
- Click NEW
  - Set the Date to Apply as the date on which this is to take effect. It should be on or close to the current date so that the transaction history is not skewed
  - Set the Stock variance account as a G/L account that will accept the net variance of the standard cost adjustments
  - Select the items. Click Add items.
    - Clear the warehouse filter
    - Select Value check as “Not zero”
    - Refresh
    - Select all
    - Select
  - UPDATE
- Command > Modify stocktake values
  - Set the COUNTED quantity of ALL items to zero
  - Run
- Special > Apply stocktake

Step 3: Load the standard cost of all raw materials

The raw materials need to be set first so that you can use these to recalculate the cost of your kit items

- Use inventory import SA4226 to set the standard cost of raw materials. This command takes a spreadsheet which must have at least Item code and Standard cost
  - Select your standard cost file
  - Run
- SPOT CHECK
  - Check that the standard costs for raw materials have come in

Step 4: Recalculate the kit cost of all assemblies by rolling up the components items

Now that the raw materials’ standard cost has been reset, you can calculate the new kit costs of assemblies

- Run SA3836
- Select the following filters (leave all filters to the right OFF)
- Click Refresh
- Special > Export report
  - Select Comma separated value in the Save as type
  - Select a location
  - Save

Step 5: Load the new standard cost of assembly items

- Open the file you saved in Step 4 in Excel or Notepad
  - Rename the column Kit item code” to “Item code”
  - Rename the column $Tot build cost to Standard cost
  - Save
- Run inventory import SA4226 to load the standard costs using the file you just saved

Step 6: Put all inventory back into stock using the new standard cost

- Open the Inventory > Stocktake form
- Click New
  - Set Date to apply and the Stock variance account to be the same as the stocktake in step 2
  - Update
- Command > Copy lines from another stocktake
  - Specify the stocktake # that was created in step #2
  - Run
- Command > Modify stocktake values
  - Select SWAP the SNAPSHOT and COUNTED quantities around
- Click Edit
  - Update costs (this is critical)
  - Update
- SPOT CHECK
  - Check that your costs now reflect the new kit rollup costs
- Special > Apply stocktake

Step 7: SPOT CHECK

- Spot check raw materials and kit costs to confirm they are ok
- Check the balance of your General ledger account. This will have the net standard cost change.

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Last edit: 15/01/21