Cost Center Closing

The cost center closing function balances all the special accounts (counterpart accounts) by generating counterpart transactions for the accounts defined at the level of the journal INVT.

The balanced accounts are the accounts defined for each item category:

- [A4] the CGS Account which records the value of the sold items,

- [A5] the Goods Receipts Account which records the standard value of the receipts (when the materials are received),

- [A6] the Purchasing Variance Account which records the difference between the duty free value and the standard costs of the receipts,

- [A7] the Inventory Adjustments Account which records the standard costs value of the inventory adjustments,

- [A8] the WIP account which records the value of the work-in-process. This value is estimated by the standard cost value of the components and of the production times,

- [A9] the Production Cost Account which records the production costs (machines, labor) estimated as the real production times multiplied by the resources standard costs,

- [A10] the Variances/Std Cost Account which records the difference between the real production cost and the item standard cost is entered (when the produced order is entered in the inventory),

- [A11] the Scrap Cost Account which records the value of the production scraps (valued via the work-in-process value).

If an account belongs to a cost center, a transaction is generated for the cost center.

The cost center closing (which can be launched at any time) permits one to update the financial data.