what is standard costing

AI generated answer (using internal Slack threads):

Standard Costing is a costing method used in accounting where you set a fixed cost for your inventory items. This cost is typically determined by historical data or market trends and is used as a benchmark for comparing actual costs. In NetSuite, when you switch to Standard Costing, you need to perform several steps: 1. Create a new item with the standard cost. 2. Create a standard cost version. 3. Roll up the process. 4. Revalue the standard cost inventory. 5. Create an inventory adjustment from the old item to the new item. It's important to note that Standard Costing may not always be the best fit for every business. Some businesses find that Average Costing provides a more realistic overview for sales, purchase, and accounting, even with low transaction volumes. For businesses with long manufacturing processes, managing purchase price variances can be a challenge. In such cases, using FIFO (First In, First Out) costing method or Lot Numbered items can help align costs and COGS (Cost of Goods Sold) more accurately. ****** Disclaimer: This response was generated by an artificial intelligence assistant based on previous conversations from multiple Slack channels, and may contain inaccuracies or mistakes. ******