The standard cost update process revalues standard and non-standard asset discrete jobs and updates pending costs to frozen standard costs. Repetitive schedules and non-standard expense jobs do not get revalued by the cost update.
The cost update creates accounting transactions by job and cost element valuation account. Each standard and non-standard asset discrete job is updated using the following formula:

Standard cost update adjustment = [new costs in (material, resource, outside processing, and overhead charges) - new costs out (scrap and assembly completion charges)] - [old costs in (material, resource, outside processing, and overhead charges) - old costs out (scrap and assembly completion charges)]

If the result of the cost update is an increase in the standard cost of the job, here are the accounting entries for a cost update transaction:

Account                                                         Debit       Credit
WIP accounting class valuation accounts                XX           -
  WIP Standard cost adjustment account               -           XX

If the result of the cost update is a decrease in the standard cost of the job, here are  the accounting entries for a cost update transaction:

Account                                                         Debit       Credit
WIP Standard cost adjustment account                 XX          -
  WIP accounting class valuation accounts                 -          XX

When the cost update occurs for open jobs, standards and WIP balances are revalued according to the new standard, thus retaining relief variances incurred up to the date of the update.