To change the cost update method:
- Log into Store Operations Manager
- Select File, Configuration from the menu bar
- Select the Inventory tab
- Specify which cost update method Store Operations should use when items are received:
- None: Select this method to not change existing item costs when purchased items are received.
- Last Cost: Select this method to replace existing item costs with received costs shown on purchase orders.
- Weighted Average: Select this method to update the item cost based on an average cost of all units of that item. When you receive new items, Store Operations adds the total cost of the unit received to the total cost of the existing units. This total cost is then divided by the total number of units on hand.
Total cost = 20 hammers @ $10.00 each + 10 hammers @ $12.00 each = $320.00
Weighted average cost = $320.00 / (20 hammers + 10 hammers) = $10.67