Without going into all kind of parameter settings…
Purchase prices and cost prices are fundamentally different things…
- A purchase price is the price you expect to pay when you buy a product
- A cost price represents the value that inventory will be worth
Suppose that the costprice of a product is 10$, but the purchase department has an opportunity to buy for 9$. The question is now if a sales employee sells for 12$ if he earned 2$ or 3$ for the company.
The difference between costprice and salesprice = sales margin (thanks to the sales employee)
The difference between purchase price and costprice is purchase profit (thanks to the purchase employee)
Depending on which method you use {Standard cost, FIFO, LIFO …) your costprice will or will not be be floating.