Inventory Valuation - Current Value vs Weighted Average Follow
When a Period is closed, Stocktake Online will consider the stock entered (whether manually or generated by Rolling Stock) and assign a value to each item. This value can be calculated using two different methods.
- Current Value
- Weighted Average
This setting can be changed from the Location Setup menu.
- Current Value will calculate the stock value based on the Product's current price. If a price is incorrect, it can simply be changed in an open period, though this may affect period variances.
- The current cost for this product is 16.00 / BTL. Therefore if I have one in stock and I close the period, my stock value for this product will be (1*16) 16.
- Weighted Average, once set, calculates the stock value based on the average of the delivery prices of that item.
- The current cost for this product is 50.00 / CS. However, this will not be taken into consideration during the stock valuation when the period is closed.
- Instead, the calculation will use an average of all the deliveries of the product till date.
- The stock value in the stock report will be the average of the delivery amount.
There are positives and negatives to consider when using either method. Stocktake Online defaults to the Current Value method but please discuss with the Support Team if you're interested in changing this.
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