Difference between revisions of "Inventory: Understanding Average Cost"
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===Simple Case=== | ===Simple Case=== | ||
Inventory Simple Case - Avg Cost IS impacted by Sequence!!! | Inventory Simple Case - Avg Cost IS impacted by Sequence!!! | ||
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| S || -50 || 60 || 15.45454545 || -772.7272727 || 927.2727273 || 15.45454545 | | S || -50 || 60 || 15.45454545 || -772.7272727 || 927.2727273 || 15.45454545 | ||
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Revision as of 18:37, 25 October 2023
Simple Case
Inventory Simple Case - Avg Cost IS impacted by Sequence!!!
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Inventory With Reversal - All Positive
Inventory with a sale reversal, but keeping it positive! All good, but sequence matters
| TxType | EFFCTV QTY | ACCUMQTY | COST | TOTCOST | ACCUMBAL | AVGCOST |
|---|---|---|---|---|---|---|
| B | 100 | 100 | 15 | 1500 | 1500 | 15 |
| S | -50 | 50 | 15 | -750 | 750 | 15 |
| I | 10 | 60 | 20 | 200 | 950 | 15.83333333 |
| S | 200 | 260 | 15.83333333 | 3166.666667 | 4116.666667 | 15.83333333 |
| I | 10 | 270 | 20 | 200 | 4316.666667 | 15.98765432 |
| S | -200 | 70 | 15.98765432 | -3197.530864 | 1119.135802 | 15.98765432 |
| TxType | EFFCTV QTY | ACCUMQTY | COST | TOTCOST | ACCUMBAL | AVGCOST |
|---|---|---|---|---|---|---|
| B | 100 | 100 | 15 | 1500 | 1500 | 15 |
| S | -50 | 50 | 15 | -750 | 750 | 15 |
| I | 10 | 60 | 20 | 200 | 950 | 15.83333333 |
| S | 200 | 260 | 15.83333333 | 3166.666667 | 4116.666667 | 15.83333333 |
| S | -200 | 60 | 15.83333333 | -3166.666667 | 950 | 15.83333333 |
| I | 10 | 70 | 20 | 200 | 1150 | 16.42857143 |
If sale and reversal are together - it doesn't matter the sequence!
| TxType | EFFCTV QTY | ACCUMQTY | COST | TOTCOST | ACCUMBAL | AVGCOST |
|---|---|---|---|---|---|---|
| B | 100 | 100 | 15 | 1500 | 1500 | 15 |
| S | -50 | 50 | 15 | -750 | 750 | 15 |
| I | 10 | 60 | 20 | 200 | 950 | 15.83333333 |
| I | 10 | 70 | 20 | 200 | 1150 | 16.42857143 |
| S | 200 | 270 | 16.42857143 | 3285.714286 | 4435.714286 | 16.42857143 |
| S | -200 | 70 | 16.42857143 | -3285.714286 | 1150 | 16.42857143 |
Inventory With Sale/Reversal - Gets Negative
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Similar to the case where items were positive, the impact of matching Negative and Postive record have no net effect even when the accumlative qty goes negative:
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If a purchase comes between a negative sale and reversal, the ending avg. cost is impacted, but this is still perfectly acceptable and correct handling for the data given.
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