Two methods exist for valuing your inventory: Average and Standard.
The Average inventory valuation method calculates the cost of goods sold as averaged over time. A product's average unit cost and average total inventory cost are recalculated each time you post inventory receipts, adjustments, and transfers. The average cost of an invoiced product is used when recalculating average unit and average total inventory costs.
The Standard inventory valuation method is calculated based on a fixed amount. This method gives you the ability to factor in a fixed amount for adding overhead costs to your calculation.
10.6 Production Release. Updated 7/7/2005 10:10:32 AM
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