Cost Groups in Oracle R12

A Cost Group is the set of accounts that hold on hand inventory.The sub inventory now represents the physical characteristics of the warehouse and the Cost Group tracks the accounts of the inventory that is held in the warehouse.

A Example of Using Different Cost Group 

With Cost Groups, it is possible to receive all the inventory to the same sub inventory and have it associated with different Cost Groups. During the receiving transaction, the Cost Group rules engine allocates a different Cost Group to the item based on the value of supplier business object.

On-Hand Example
SubinventoryLocatorItemQtyLPNCost Group

What is a Storable Unit in Oracle Inventory?

A Storable Unit is a quantity of inventory, uniquely identifiable by a combination of Item Number, Revision, Lot, Serial Number, LPN, and Locator.

What is Cost group Commingling?

Commingling is an attempt to assign two distinct Cost Groups to a single Storable Unit of inventory.

How Can we Change the Cost Group of an Storable Unit ?

The Cost Group Update transaction is specifically designed to do this. The physical location of the inventory is managed by a Sub inventory Transfer, and ownership is separately managed by a Cost Group Update.

Does a Serialized Item Ever Come Under Cost Group Co Mingling?

There is no circumstance under which a co-mingling error may arise for serial tracked inventory, since every unit of inventory is its own Storable Unit, uniquely identified by the serial number.
Further Reading

Cost group Assignments Inventory and WMS Orgs