Ave Cost Calculation Type

Is found under the Inventory Setup. 1. Does anyone have a difinative description of what this does. We have it set at “Item”, currently, and finding that some reports do not work correctly when filtering for a Location. e.g. Inventory Valuation. In a test system I am changing it to “Item, Location and Variant” and the Batch process is taking a long time (over 16 hours so far), as expected. 2. Will it take this long every time I run it, from now on? Being a manufacturing Company, we don’t have a down time long enough to cover this sort of delay, during a normal week. Regards John

From the help: Average Cost Calc. Type Field The Inventory Setup Table This field contains information about the method that the program uses to calculate average cost. Note If you change the average cost calculation type, all entries will be adjusted. This means that entries that have already been posted will also be changed. The options are: Item. If this option is selected, the program calculates one average cost per item in the company. Item & Location & Variant. If this option is selected, the program calculates an average cost per item for each location and for each variant of the item in the company. This means that the average cost of this item depends on where it is stored and which variant (for example, which color) of the item you have selected. Warning You must choose the type of method very carefully during setup, because if you change the contents of this field, all entries concerning items with costing method Average will have to be readjusted. This may take several hours if your database is large.

Average costing is set up at the item level, here you determine if you want to calculate COGS as a Average. When calculating Average cost, there are two ways of calculating, By Item number or by SKU (i.e., Variant and Location). You set this globally, and of course if you change it, then the system must recalculate all the historical values before you can use the new menthod. This is a ONE OFF process, in fact you really only expect to do it when you first setup your database, or because of a major business process change. So you wont have to run the routine again. PS this should probably be in the Beginers Forum, its not a technical question. Moved…