Difference between revisions of "Inventory: Understanding Average Cost"
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| + | ===Simple Case=== | ||
| + | Inventory Simple Case - Avg Cost IS impacted by Sequence!!! | ||
| + | {| | ||
| + | | width="50%" valign="top" | | ||
| + | |||
| + | {| class="wikitable" | ||
| + | ! TxType !! EFFCTV QTY !! ACCUMQTY !! COST !! TOTCOST !! ACCUMBAL !! AVGCOST | ||
| + | |- | ||
| + | | Beg Bal || 100 || 100 || 15 || 1500 || 1500 || 15 | ||
| + | |- | ||
| + | | Sale || -50 || 50 || 15 || -750 || 750 || 15 | ||
| + | |- | ||
| + | | Purchase || 10 || 60 || 20 || 200 || 950 || 15.83333333 | ||
| + | |} | ||
| + | |||
| + | | width="50%" valign="top" | | ||
| + | |||
| + | {| class="wikitable" | ||
| + | ! TxType !! EFFCTV QTY !! ACCUMQTY !! COST !! TOTCOST !! ACCUMBAL !! AVGCOST | ||
| + | |- | ||
| + | | Beg Bal || 100 || 100 || 15 || 1500 || 1500 || 15 | ||
| + | |- | ||
| + | | Purchase || 10 || 110 || 20 || 200 || 1700 || 15.45454545 | ||
| + | |- | ||
| + | | Sale || -50 || 60 || 15.45454545 || -772.7272727 || 927.2727273 || 15.45454545 | ||
| + | |} | ||
| + | |} | ||
| + | |||
===Inventory With Reversal - All Positive=== | ===Inventory With Reversal - All Positive=== | ||
| Line 56: | Line 84: | ||
|- | |- | ||
| Sale || -200 || 70 || 16.42857143 || 1150 || 16.42857143 | | Sale || -200 || 70 || 16.42857143 || 1150 || 16.42857143 | ||
| + | |} | ||
| + | |} | ||
| + | |||
| + | ===Inventory With Sale/Reversal - Gets Negative=== | ||
| + | |||
| + | {| | ||
| + | | width="50%" valign="top" | | ||
| + | |||
| + | 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: | ||
| + | {| class="wikitable" | ||
| + | ! TxType !! EFFCTV QTY !! ACCUMQTY !! COST !! ACCUMBAL !! AVGCOST | ||
| + | |- | ||
| + | | Beg Bal || 100 || 100 || 15 || 1500 || 15 | ||
| + | |- | ||
| + | | Sale || -50 || 50 || 15 || 750 || 15 | ||
| + | |- | ||
| + | | Purchase || 10 || 60 || 20 || 950 || 15.83333333 | ||
| + | |- | ||
| + | | Sale || -200 || -140 || 15.83333333 || -2216.666667 || 15.83333333 | ||
| + | |- | ||
| + | | Sale || 200 || 60 || 15.83333333 || 950 || 15.83333333 | ||
| + | |- | ||
| + | | Purchase || 10 || 70 || 20 || 200 || 16.42857143 | ||
| + | |} | ||
| + | | width="50%" valign="top" | | ||
| + | |||
| + | 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. | ||
| + | {| class="wikitable" | ||
| + | ! TxType !! EFFCTV QTY !! ACCUMQTY !! COST !! ACCUMBAL !! AVGCOST | ||
| + | |- | ||
| + | | Beg Bal || 100 || 100 || 15 || 1500 || 15 | ||
| + | |- | ||
| + | | Sale || -50 || 50 || 15 || 750 || 15 | ||
| + | |- | ||
| + | | Purchase || 10 || 60 || 20 || 950 || 15.83333333 | ||
| + | |- | ||
| + | | Sale || -200 || -140 || 15.83333333 || -2216.666667 || 15.83333333 | ||
| + | |- | ||
| + | | Purchase || 10 || -130 || 20 || 2016.666667 || 15.51282051 | ||
| + | |- | ||
| + | | Sale || 200 || 70 || 15.51282051 || 1085.897436 || 15.51282051 | ||
|} | |} | ||
|} | |} | ||
Latest revision as of 18:53, 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
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Here, a purchase receipt comes between the +Reversal and -Sale record.
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Here, The +Reversal comes immediatelyh before the -Sale record.
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If sale and reversal are together - it doesn't matter the sequence!
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Inventory With Sale/Reversal - Gets Negative
|
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:
|
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.
|
