Good afternoon,
I have a problem I can't get my head around with item costs.
Our item costing method is FIFO, in my head I had assumed I buy 10x Item 1 in January at £5 each, the cost price will display as £5, I sell 7 of these by March, then in March I buy another 5 at £15, again in my head I thought the cost would still display as £5 until the last 3 were sold, then it would update to £15 when down to the last 5 purchased in March.
Either that, or the cost would have updated to £15 end off.
However, our environment seems to actually update the /Unit Cost/ field to an average between the 2, as opposed to the actual cost price, there is a field that says /Last Direct Cost/ admittedly this does show the last price we paid for the item, however, items are setup as Price=Cost+Profit, so when the unit cost field is not correct, it actually screws up our selling price.
Is there a way round this or is there something I'm missing?
Hopefully the above made sense and someone can comment.
Thanks,
Gareth
