How item cost are computed when selecting Weighted Average cost update method

When item on-hand quantity goes positive, it's all right with the (Beginning
inventory cost  +  Current purchase cost) / (Beginning inventory units +
Current purchase units) formula.

But I am just curious when on-hand quantity goes negative or zero, will RMS
still computed item cost with the formula above?

Assume that we have in stock 3 hammers that cost $10.00 each, then we sale 6
hammers at POS, and we then order 6 more hammers that cost $12.00 each.

Any ideas?


0
kaibin (12)
4/13/2005 2:46:42 AM
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and we then order 3 more hammers that cost $12.00 each. NOT 6.


"Kaibin" <kaibin@hotmail.com> wrote in message
news:uwcEUM9PFHA.3988@tk2msftngp13.phx.gbl...
> When item on-hand quantity goes positive, it's all right with the
(Beginning
> inventory cost  +  Current purchase cost) / (Beginning inventory units +
> Current purchase units) formula.
>
> But I am just curious when on-hand quantity goes negative or zero, will
RMS
> still computed item cost with the formula above?
>
> Assume that we have in stock 3 hammers that cost $10.00 each, then we sale
6
> hammers at POS, and we then order 6 more hammers that cost $12.00 each.
>
> Any ideas?
>
>


0
kaibin (12)
4/13/2005 2:54:26 AM
Reply:

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