Cost Adjustment Types

A landed cost adjustment type must be setup within EBMS before the purchase cost can be adjusted. Review the following adjustment types:

• Freight - Freight costs are the most common reason to adjust the purchase cost to reflect the landed cost. This type may include shipping or freight costs that are billed on a separate invoice or may be freight on the same purchase order. There may be multiple freight costs such as overseas shipping, handling, or insurance.
• Handling - The handling type can be used for a variety of additional costs or labor that increase the original purchase cost.  
• Insurance - A variety of legal expenses may increase the purchase cost of product.  
• Processing - The processing cost type could be used to cover the additional costs incurred to prepare the purchased product for sale.
• Rebates - This type can be used to reduce the purchase cost based on a guaranteed rebate rather than increasing the costs as the other types.

Complete the following steps to setup landed cost adjustment types:

1. Click on Expenses > Options from the main EBMS menu and click on the Landed Costs tab as shown below:
   

2. Enter the most common landed Cost Type ID as shown above.

3. Enable the Default option to identify the type used within the expense invoice without pre-assigning landed cost adjustments with an item.

4. Enter a Description of the landed cost type.

5. Enter the credit G/L account. This general ledger account is used to post the credit transaction of the landed cost adjustment.

    

   Debit	Credit	Amount
   Purchase GL on PO	Landed Cost G/L	Amount of cost adjustment

6. Repeat the steps listed above for any additional Landed Cost Types.

Review Assigning Default Landed Costs to an Item for details on entering adjusting cost entries for specific inventory items.

Review Adjusting Landed Costs within a Purchase Order for instructions on how to enter landed costs.