Easily incorporate extra costs like shipping, customs, and service fees into your purchase orders (POs) to ensure accurate inventory valuation and financial reporting in Katana.
These costs are not regular inventory items but are instead allocated across purchased items, impacting their total value and helping you calculate a more accurate landed cost.
Why use additional costs?
Reflect true cost of goods, including shipping, customs, or handling fees
Improve inventory cost accuracy
Support reliable profit margin calculations
Track additional expenses on printed or emailed PDF POs
How to add additional costs to a PO
You can add costs to Not received, Partially received, and Received POs or OPOs—if the PO falls within an open inventory period.
Open a PO
Click
Additional costs(below the items table)
In the new Additional costs table:
Costs: Choose from
Shipping,Customs, orOther
Reference: Add a note for the service or tax type
Distribution method: Choose how the cost is allocated to items:
By valueBy quantity
Total price: Enter the amount (uses the PO’s currency)
Tax: Select a tax rate
To add more lines, click + Add row
Additional costs are included in the order totals.
Note: Tax is not distributed across the items; it’s applied to the additional cost line itself.
What happens after adding costs?
Landed cost is automatically calculated per item.
This appears in the Landed cost column of the PO and cannot be manually edited.
Additional costs are included in the PO total and show on print/PDF exports.
If costs are added to a Received PO, Katana recalculates the Moving Average Cost (MAC) for the items.
Example: "By value" distribution
Let’s say you have the following items:
Item | Qty | Unit price | Total price |
A | 4 | $8 | $32 |
B | 4 | $10 | $40 |
C | 4 | $12 | $48 |
Total item value = $32 + $40 + $48 = $120
Additional cost to distribute = $105
Allocation rate = 105 / 120 = 0.875 per $1
Resulting landed costs:
Item | Base | Allocation | Landed cost/pc |
A | $8 | $8 × 0.875 = $7 | $15.00 |
B | $10 | $10 × 0.875 = $8.75 | $18.75 |
C | $12 | $12 × 0.875 = $10.5 | $22.50 |
Note: If all item prices are zero, the cost is distributed by quantity instead.
Summary
Adding and distributing additional costs in Katana gives you a much clearer picture of the true cost per item—essential for accurate financials and smarter purchasing decisions.
Do you need to update item costs after adding these? Check out the Landed cost column on your PO and monitor your MAC's automatic adjustment in your inventory.
Your feedback is invaluable. Let us know your thoughts on this article or anything in Katana you'd like to see improved: [email protected]