Cost management home page


Dynamics 365 for Finance and Operations is now being licensed as Dynamics 365 Finance and Dynamics 365 Supply Chain Management. For more information about these licensing changes, see Dynamics 365 Licensing Update.

Cost management (video) lets you work with the valuation and accounting of raw materials, semi-finished goods, finished goods, and work-in-progress assets. It is the process of defining, managing, and reporting Inventory accounting and Manufacturing accounting.

You can define cost policies in the following areas:

For example, you can define which inventory valuation methods, such as FIFO, Weighted average, Standard cost, or Moving average that you want to apply to products in the Item model group in Inventory accounting.

You can access Inventory accounting and Manufacturing accounting from the Cost administration and Cost analysis workspaces. These workspaces provide a comprehensive overview of the current status, key performance indicators (KPIs), and detection of deviation.

Manufacturing accounting lets you handle Job order costing in production orders and batch orders, as well as Backflush costing in lean manufacturing.

The Cost management Power BI content provides managerial insight into inventory and work-in-progress (WIP) inventory, and how cost flows through them by category over time. The information can also be used as a detailed supplement to the financial statement.

Additional resources

What's new and in development

Go to the Microsoft Dynamics 365 Roadmap to see what new features have been released and what new features are in development.

White paper

BOM calculation by using a costing sheet describes how to set up a costing sheet that includes material and manufacturing, and how the setup affects the BOM calculation results. To better explain the topics, it provides concrete scenarios and data that demonstrates the effect of the various settings and configurations. We don’t expect that you will follow all these scenarios, because this document doesn't provide enough details to configure them. Nevertheless, if you have the basic knowledge, you can try to play the task guides listed below in the order that they appear. Use the knowledge that you’ve gained from reading this document to do BOM calculation analysis.


You can find opinions, news, and other information about Cost management on the Dynamics AX Manufacturing R&D Team blog and Supply Chain Management in Dynamics AX R&D Team blog. Although some of these posts were written for the previous version of Cost management, the same concepts still apply, and the procedures are also similar in the current version.

Task guides

Additional help is available as task guides. To access task guides, click the Help button on any page.