Specifies how the item's cost flow is recorded and whether an actual or budgeted value is capitalized and used in the cost calculation.
Your choice of costing method determines how the unit cost is calculated by making assumptions about the flow of physical items through your company. For more information, see Unit Cost Calculation.
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TRIMIT Add-on:
If you have set the Use Standard Cost Globally parameter in General Ledger Setup to either Yes without G/L Posting or Yes with G/L Posting, you cannot use this Costing Method to determine how the Unit Cost of the Item is calculated.
In this case you only use the Costing Method to decide in which order Item Ledger Entries are closed. In other words, the Costing Method will then control the posting of quantities but NOT the values of the Item Ledger Entries.
This also means that you can only use the Costing Methods FIFO,
LIFO and NINO when you use the TRIMIT Standard Cost
globally.
NINO (No In No Out) is a special TRIMIT option
enabling you to include the cost of the Item in Production Orders
without including the Item in your inventory management.