Folders, Item, Costs - Explained

Costs

An item can maintain up to three (3) costs: market cost, last receipt, and weighted average. Not all items maintain costs.

•Market Cost

The current market cost is a manually maintained cost that may or may not be used by your company. It is intended to be used as the "going rate" for new purchases of the product. The unit of measure (UM) used for cost pricing is displayed to the right of this cost in parentheses. The other costs are reflected using the same measure.

•Last Receipt

The "last receipt" cost, when updated, is the most recent purchase (received) cost for the product. When items are assigned a receipt cost of zero, the last receipt cost won't update when receiving is done.

•Weighted Average (WAVG)

Weighted average is recalculated each time an item is received. This calculation is based upon the existing quantity and average cost and the new quantity and cost being added to inventory. Average cost is only calculated if the last receipt cost assigned to the item is not zero and the item setting "Track Quantity On Hand" is enabled (yes).

The "Update On" date lists the last time costs were updated for the selected item. If an item's costs haven't been updated in a long time, it can be a good idea to check for the current cost of the product prior to ordering or quoting prices that may be based upon the old costs.