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Cost Method

To support a new costing method, Periodic Weighted Average Costing, the following modules have been created:

DATAENTRYBASIC.EXE

COGSAVGPERIOD

To create periods for COGS periodic average cost method.

DATAENTRYINVENTORY.EXE

CALCCOGSPERIODICAVG

To calculate periodic average cost.

MERCHANTEOD.EXE

DELETECOGSAVGPERIOD

To delete old expired COST records.

The average cost is calculated at the end of the specified period and the calculated average is used as the new Cost of Goods Sold (COGS) until the next periods cost is calculated.

Creating Periods

In COGSAVGPERIOD, periods can be created by selecting a Period Type (Daily, Weekly or Monthly) along with the Period Interval. For example, if the Period type is Daily and the Period Interval is 1, From Date of 12/1/2012, To Date of 12/19/2012, then the periods are created for each day as shown below:

Figure: Example Periods for COGS Average Calculation

System Settings

The new COGS Method ‘Periodic Average’ has been added to the POS1 tab within system settings.

Figure: Example System Settings

Calculating Periodic Average

In Schedule Jobs a new procedure ‘COGS Periodic Average Calculation’ has been added.

Figure: Example Schedule Jobs

When Process Job is started for COGS Periodic Average Calculation, the average is calculated for all items of all locations having the same tax system and the same currency code as of ‘ALL’ location.

Formula :

Total Cost of SOH of all locations at the beginning of the period)+ (Cost of all Good Receiving of all locations for the current period)-(Cost of all Good Return of all locations for the current period)}÷ {(Total SOH QTY of all locations at the beginning of the Period)+( Total QTY of all Good of all locations Receiving for the current period)-(Total QTY of all Good Return of all locations for the current period)

Figure: Example Process Jobs

Stock Audit

A new tab ’Periodic Average’ is added in the Stock Audit screen. Calculated Periodic average is displayed in Periodic Average tab when the user runs the ‘COGS Periodic Average Calculation’ through Process Job. (This tab will be visible only if ‘Periodic Average’ COGS method is set in system settings).

Figure: Example Stock Audit

Notes:

1. When COGS Periodic Average is started, average is calculated only for first uncalculated period. For example:

Period 1: From 12/01/2012 To 12/01/2012

Period 2: From 12/02/2012 To 12/02/2012

When both Period 1 and Period 2 Average are not calculated and COGS Periodic Average Calculation is started, only Period 1 average will be calculated. To calculate Period 2 Average COGS Periodic Average Calculation should be run again, that is, only 1 period average will be calculated at once.

2. To have correct records in Periodic average tab of stock audit, run one period without making any transactions immediately after setting Periodic Average in system settings. (This is because if different locations have different average cost and SOH at PERIODSTART is not zero, expected and current average might not be same as it considers all locations average cost for calculation).

3. If Period is of current date (Currently used period), then Average will not be calculated. Average will be calculated only after the Period completes e.g. Period1: From 12/01/2012 To 12/01/2012, this period can be run only on or after 12/02/2012.

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